May 29, 2024
Singapore's Vauld, a crypto exchange in bankruptcy, approved for a board overhaul by the court
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Vauld, Singapore Crypto Exchange in Bankruptcy Proceedings, Gets Court Nod for Board Overhaul

Singapore-based cryptocurrency exchange Vauld, which has been undergoing bankruptcy proceedings since August 2022, has announced that it has received court approval to revamp its board as part of its restructuring efforts. The newly appointed top management will take charge of the company’s recovery process.

In August 2022, Vauld was granted a three-month moratorium to devise a restructuring strategy. Initially, a plan for acquisition by Swiss-headquartered crypto lender Nexo was proposed, but in January 2023, law enforcement raided Nexo’s office, leading to the halt of negotiations. During the same month, Vauld was afforded another phase of protection for creditors by a Singaporean court, which was later extended in February. The company’s outstanding debts amount to approximately $400 million, with the bulk consisting of individual depositors’ funds.

According to Vauld’s co-founder, Darshan Bathija, the scheme of arrangement proposed by the company has been successfully sanctioned by the Singapore court. As per this arrangement, the existing board will be replaced with a new CEO, a representative from the creditors, and a scheme manager. He announced this on Aug. 24 on X (formerly Twitter).

Additionally, the platform has reinstated the know-your-customer (KYC) verification process for its current customers, who are now required to resubmit their verification documents. In August 2022, the Indian branch of Vauld, Flipvolt Technologies, faced a seizure of $46.4 million by Indian law enforcement due to alleged money laundering. In July 2022, Vauld suspended customer withdrawals, attributing the decision to adverse market conditions and a two-week “bank run” that led to withdrawals worth $200 million. The company cited losses stemming from the devaluation of major cryptocurrencies and its exposure to the collapsed stablecoin UST in May 2022.

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