Singapore-based cryptocurrency loan and exchange firm, Vauld, has put a stop to all transactions on its platform, including deposits, withdrawals, and even new deposits. Vauld’s CEO, Darshan Bathija, claims that the exchange has made the decision because of financial troubles. According to the firm, the market crash has pushed clients to withdraw around $198 million since June 12. The development epitomizes the depth to which the crypto market has sunk in the first half of 2022.
How it started and what Vauld plans to do
In June, Vauld announced that it would reduce its workforce by 30 percent, sending the first signal of trouble for the exchange. The corporation also announced in a release at the time that it was reducing its marketing spending, curtailing hiring, and slashing executive salaries by 50%. According to sources, the company is currently using customer deposits to pay margin calls on collateralized loans.
Even more shocking is the fact that this new failure for Vauld occurred less than three weeks after the company announced that withdrawals were being processed normally. However, it’s no secret that the crypto market currently faces its worst period in its short history. Besides Vauld, there are other digital assets platforms staring at possible collapse. Celsius Network is already at its tipping point, while BlockFi is also struggle to stay afloat. Also, cryptocurrency hedge fund has in the past week filed for bankruptcy.
The genesis of the current market tumult traces back to the beginning of Russia’s attack of Ukraine. The war triggered panic in global financial markets, with cryptos worst-hit. Furthermore, the collapse of LUNA whipped out $40 billion from the market in under a week, thus exacerbating the situation. In the meantime, Vauld is working on a legal recourse to protect the company from possible suits as it tries to resuscitate. Also, the company is inviting possible investors to help it find its footing.