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Crypto exchanges are in discussion with potential investors in the World Group of Companies. It is also planning to apply to a Singapore court for the moratorium.
Vauld CEO Darshan Bathija said that due to the current market environment, customers have made significant withdrawals of more than $ 197.7 million since June 12, 2022. The collapse of the cryptocurrency market is caused by the collapse of UST Stablecoin of Terraform Labs, Celsius is halting network withdrawals, and Three Arrow Capital is defaulting on their loans.
Vauld is also considering possible restructuring options. It has hired Kroll Pvt. Ltd. as its financial advisor as well as Cyril Amarchand Mangaldas and Raja and Ten Singapore LLP as its legal advisors in India and Singapore respectively. The crypto exchange is in discussions with potential investors in Vauld Group companies. It is also planning to apply to a Singapore court for the moratorium.
Backed by Coinbase Ventures, Vauld said while laying off its employees that with its team of more than 100 employees, the platform will send significant products this year. Wald serves more than 8 million customers. Interestingly, just a fortnight ago, the exchange said it would soon ship significant products and announce its plans for the next six months.
The crypto industry is struggling with a 30% tax on profits, Crypto Winter, and 1% TDS. Edul Patel, CEO, and co-founder of Murex, a global crypto investment platform, told TNIE that the last few months have been a bit of a hassle for the cryptocurrency spectrum. “Several concurrent patterns such as hedge fund liquidation and stablecoin de-pegging provided fodder for the crisis.
He pushed some exchanges and platforms against the wall. However, as the space gradually matures, we will likely see proper checks and balances, ”he added.
Financial difficulties
World Management said that despite its best efforts, it is facing financial challenges. The cryptocurrency company said that due to the current market environment, the cryptocurrency market declined significantly due to the collapse of Terraform Lab’s Terra-Luna stablecoin, Celsius network posing withdrawals, and three arrow capital defaults. Loan
The three-year-old firm, which raised an estimated $ 27 million from investors, including Pantera Capital, Coinbase Ventures, and Peter Thiel-backed Waller Ventures, claimed the market collapse forced customers to withdraw about $ 198 million from June 12.
Restructuring
Vauld is currently in discussions with potential investors. The company wants to apply for a moratorium to initiate or continue any proceedings against the companies concerned to give the company a breathing space to carry out the proposed restructuring exercise.
“We believe this will work with our financial and legal advisers to help promote the investigation of potential restructuring options. We seek the understanding of Vauld Platform customers that we will not be in a position to process any new or further requests or notifications in this regard. Certain arrangements will be made for customer deposits as it may be necessary for certain customers to meet margin calls in relation to collateralized loans, ”the company said.
Downsizing
Earlier last month, vauld appeared to be present for a while as he said he would cut his staff by 30 percent in June. The company also said in the release that it is cutting its marketing costs, reducing recruitment efforts, and cutting executive salaries by 50 percent. For this, the business has justified the economic downturn.
Conclusion
The company said specific arrangements will be made for customer deposits to meet margin calls to specific customers about collateralized loans.
Vauld has already slashed its marketing costs, slowed hiring efforts, slashed executive returns by 50 percent, and suspended most vendor engagements.
