A Singapore court has granted struggling cryptocurrency lending platform Vauld another period of creditor protection. The company must present a reactivation plan before February 28.
As Bloomberg reported on January 17, Vauld has been given more than a month to close its negotiations with one of two digital asset fund managers to gain executive control of the tokens stuck on its platform. Singapore’s high court is reportedly satisfied with the company’s assertion that the negotiations have entered an “advanced stage”.
In July 2022, The platform halted withdrawals for its 800,000 clients, citing unfavorable market conditions and an unprecedented $200 million in withdrawals in less than two weeks. In August 2022, It has already been granted a three-month moratorium to develop a business restructuring plan and offer a better result to its creditors. At the time, the judge denied the company’s request for a six-month protection period, arguing that a longer moratorium “will not achieve adequate supervision and surveillance.”
From the beginning of the first moratorium, it was known that Nexo, a Swiss-based cryptocurrency lender, intended to acquire Vauld with all of its assets. Nevertheless, after Nexo’s own office in Bulgaria was raided by the police, Vauld denied any possibility of this deal.
This is not the first time that Singaporean authorities have shown their willingness to allow struggling cryptocurrency companies to fix their problems. Another major Singapore-based platform, Zipmex, has been granted a three-month moratorium to fix its liquidity problems in August 2022.
However, the fate of cryptocurrency loans in the country remains unclear, as Singapore’s central bank has proposed to ban digital payment token service providers from offering “any credit facilities” to consumers, including both current money and cryptocurrencies.
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