Crypto lender Vauld gets three-month creditor protection

Vauld's parent company, Defi Payments Ltd, says Monday's moratorium will give it leeway to develop a restructuring plan .

Struggling crypto lending platform Vauld was granted a short reprieve from its creditors after receiving a three-month moratorium from the Singapore High Court on Monday.

His initial request from Vauld's parent company, Defi Payment Limited, for a six-month moratorium was reportedly rejected by Judge Aedit Abdullah on August 1, fearing that a longer moratorium "would enjoy oversight and adequate control," according to a Bloomberg Report.

Under the moratorium, Defi Payments would be protected from winding-up resolutions, the appointment of a receiver or manager, and any legal proceedings that may be brought against the company, including those that may be brought by its 147,000 creditors.

Vauld said in its website's updated FAQ on Monday that the moratorium would provide the leeway needed to come up with a plan to restructure the business and deliver a better outcome for its creditors.

"The moratorium is an important procedure to provide the company with the necessary leeway to formulate and carefully consider its options."

Vauld noted that without a moratorium, it would be "highly likely" that creditors would only receive a fraction of their account value.

As the new protective order expires on November 7, Judge Abdullah says he will grant an extension if Vauld is transparent about his progress in reimbursing creditors.

The crypto platform was also given two weeks to form a creditors' committee and provide cash flow and asset valuation details to creditors.

Exploring the possibility of minimum withdrawals for their remaining clients was also recommended by the High Court judge...