The crypto-company has announced that it is pausing withdrawals, transactions and deposits from its customers. 800,000 users are concerned.
After Celsius, Finblox, and CoinFlex, it is the turn of the Vauld lending platform to be in turmoil. This Monday, the Singaporean company announced that it had to pause withdrawals, transactions and deposits from its customers.
Founded in 2018, Vauld is a cryptocurrency lending platform with 800,000 customers. As a reminder, a staking service is a loan of cryptocurrencies on a blockchain against interest. Vauld offered yields on dozens of cryptocurrencies, with interest rates of up to 40%.
“We ask clients to understand that we will not be able to process any new requests or instructions. Specific arrangements will be made for client deposits which may be required for some clients to meet margin calls in relation to collateralized loans,” the company said.
To justify this decision, the company cited difficult market conditions, the “financial difficulties” of its main trading partners, as well as recent events that have shaken up the crypto ecosystem: fall of the terra usdt (ust) of the Terra blockchain, freeze on withdrawals from Celsius on June 12, questions about the default of payment by the investment fund Three Arrow Capital.
$198 million withdrawn from the platform
These different elements, which have cast doubt on the stability of certain lending platforms, have scared many individuals and investors. Result: Vauld clients have withdrawn approximately $198 million from the platform since June 12, destabilizing the platform’s liquidity.
Along with Celsius, Vauld called on legal and financial advisers to deal with this delicate situation:
“Our management remains fully committed to working with our financial and legal advisors to the best of our abilities to explore and analyze all possible options, including potential restructuring options, that would best protect the interests of Vauld’s stakeholders,” said the company said in a statement.
The company intends to ask the Singapore courts for a “moratorium” stopping all proceedings against it in order to give it “breath” to carry out a restructuring.
The company, which had so far raised 27 million dollars, is supported among others by the Pantera venture capital fund. The situation seemed delicate for some time for Vauld: at the end of June, the company announced that it had to part with 30% of its employees, out of a total of 100 employees. The company also said it plans to cut marketing spending as well as executive compensation.