Singapore-based cryptocurrency exchange Vauld, which has been embroiled in bankruptcy proceedings since August 2022, has announced a pivotal development in its journey towards recovery.
The company recently received court approval to initiate a comprehensive restructuring of its board, signifying a significant step forward in its efforts to stabilize and rejuvenate its operations.
Co-founder of Vauld, Darshan Bathija, took to social media platform X (formerly known as Twitter) on August 24th to reveal that the company’s proposed scheme of arrangement had successfully gained judicial endorsement within a Singaporean court.
As per the approved scheme, Vauld’s current board is set to undergo a transformative overhaul.
The restructured leadership will include a fresh Chief Executive Officer (CEO), a representative chosen by the creditors, and a capable scheme manager.
In a demonstration of its commitment to regulatory compliance and operational integrity, Vauld has reinitiated the Know Your Customer (KYC) verification process for its existing clientele.
These clients are now required to resubmit their verification documents, marking a concerted effort to enhance transparency and security within the platform’s operations.
The company’s plight was catalyzed in August 2022 when Indian law enforcement seized a substantial sum of $46.4 million from Vauld’s Indian subsidiary, Flipvolt Technologies.
This action was spurred by allegations of money laundering, further exacerbating the exchange’s financial challenges.
Vauld faced an array of obstacles, including the temporary suspension of customer withdrawals in July 2022.
This measure was attributed to both unfavorable market conditions and a significant withdrawal surge, amounting to $200 million.
READ MORE: New DeSo Network Friend.tech Generates Over $1 Million in 24 Hours
The company’s financial turmoil was exacerbated by losses linked to the declining values of major cryptocurrencies, as well as its exposure to the beleaguered stablecoin TerraUSD (UST), which suffered a collapse in May 2022.
Following these setbacks, Vauld was granted a three-month moratorium in August 2022 to devise a viable restructuring strategy.
An initial proposal suggested an acquisition by Swiss crypto lending entity Nexo, though negotiations with Nexo were terminated in January 2023.
Amidst these ongoing challenges, Vauld obtained successive periods of creditor protection from Singaporean courts.
The company’s outstanding debts, totaling around $400 million, primarily encompass funds owed to individual depositors.
With the court’s approval of its restructuring plan, Vauld is poised to embark on a transformative journey under new leadership.
This pivotal juncture could potentially pave the way for the exchange’s resurgence and the restoration of trust among its stakeholders.
Other Stories:
UK Prime Minister Allocates £100 Million to Acquire Computer Chips for AI Advancement
Bitget Cryptocurrency Exchange Enhances KYC Procedures to Align with Global Regulations
Ordinal Inscriptions Maintain Dominance on Bitcoin Network Despite Price Dip
