The parent of the troubled crypto lender, Vauld has been granted a three months moratorium period by a Singapore court, Bloomberg reported. It will provide temporary protection to the company from creditors from taking any legal action.
However, the company asked for a moratorium period of six months, only half of which has been approved. The approved protection will last until November 7.
Valued owes more than $400 million to its 147,000 creditors. Of the total, 90 percent originated from retail investor deposits.
“I am concerned a six-month moratorium won’t get adequate supervision and monitoring,” said the Singapore High Court judge. He further highlighted that an extension of the protection period is also possible, but will be based on the assessment of the company’s progress in engagement with creditors.
The court also asked the crypto company to form a creditors committee for addressing the issues.
Troubles Leading to Acquisition?
Singapore-based Vauld is one of the crypto lenders that offered interest against cryptocurrency deposits. The interest rate on the platform was as high as 13 percent in some cases.
The troubles of the company were exposed when it suspended all activities, including withdrawals in early July citing “financial challenges.” It witnessed $198 million in withdrawals from the platform since June 12 due to the woes of the cryptocurrency market.
Now, the company is in talks with Nexo, another crypto lending
