A Singapore court once again extends the term of creditor protection to the troubled cryptocurrency lending platform Vauld. The lender was given more than one month to develop a resurrection strategy.
Vauld has been given more than a month to conclude discussions with one of two digital-asset fund managers to assume executive management of the coins ensconced on its platform, as Bloomberg reported on January 17.
It seems that the company’s assertion that the discussions have reached an “advanced stage” has been accepted by the Singapore high court.
The company stopped allowing withdrawals for its 800,000 clients in July 2022, claiming poor market circumstances and a record-breaking $200 million in withdrawals in only two weeks.
Vauld was previously given a three-month moratorium in August to develop a restructuring strategy for the company and provide improved terms to its creditors.
A longer moratorium “won’t receive proper oversight and monitoring,” the court said at the time, rejecting the company’s request for a six-month protection period.
It was known from the start of the first moratorium that Nexo, a crypto lender with its headquarters in Switzerland, wanted to buy Vauld and all of its assets. Vauld, however, disputed the existence of this contract once the authorities searched Nexo’s own headquarters in Bulgaria.
It’s not the first time Singaporean authorities have shown that they are willing to allow struggling cryptocurrency businesses to resolve their issues.
A three-month suspension has also been given to Zipmex, a significant Singapore-based platform, in order to address liquidity concerns in August.
Although Singapore’s central bank has proposed prohibiting digital payment token service providers from providing customers with “any credit facility,” including both fiat currency and cryptocurrencies, the future of crypto lending in the nation is still up in the air.
