The decision comes amid a broader volatility in the cryptocurrency market and as the platform faces financial challenges. Vauld is looking at a potential restructuring.
The company, backed by PayPal founder Peter Thiel's Valar Ventures, has suspended all withdrawals, trading, and deposits with immediate effect, essentially locking in retail investor capital.
It has engaged the services of Kroll as its financial advisor, and legal firms Cyril Amarchand Mangaldas and Rajah & Tann Singapore LLP in India and Singapore, respectively.
“We believe this will help facilitate our exploration of the suitability of potential restructuring options, together with our financial and legal advisors. We seek the understanding of the customers of the Vauld platform that we will not be in a position to process any new or further requests or instructions in this regard. Specific arrangements will be made for customer deposits necessary for certain customers to meet margin calls in connection with collateralised loans,” Bathija wrote.
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Most of its customers are in the United States, followed by India, he had told ET in an earlier interaction.
The company raised $27 million as of July last year from venture capital firms including Pantera Capital, Coinbase Ventures, CMT Digital, Gumi Cryptos, Robert Leshner, and Cadenza Capital.
Founded in 2018 by Bathija and Sanju Kurian, Vauld provides a suite of products to crypto investors, including fixed deposits and asset-backed lending and borrowing platforms.
ET reported on June 21 that the collapse of Terra’s blockchain native token Luna - which reportedly erased $40 billion from the crypto market - has had a cascading effect.
Decade-old crypto hedge fund and an active backer of Web3 startups, Three Arrows Capital, has filed for bankruptcy.
Crypto lender Celsius network is reportedly exploring options including deals and restructuring its liabilities and has laid off 150 employees.
We've taken the painful decision to reduce Vauld's headcount by about 30%More information: https://t.co/gD7epuXuvo
— Darshan Bathija (@darshanbathija) 1655788724000
In June, Vauld announced it had laid off 30% of its workforce, most of whom were based in India.
“Our management remains fully committed to working with our financial and legal advisors to the best of our abilities to explore and analyse all possible options, including potential restructuring options that would best protect the interests of Vauld’s stakeholders,” Bathija said in the note.