Vauld, a Singaporean cryptocurrency exchange and lending platform, is in financial trouble, which led it to shut down its withdrawal services on Monday. Nexo has made a buyout proposal to the company, which it has agreed to.
Vauld to be acquired by Nexo
Singaporean cryptocurrency lending platform Vauld could be acquired by Nexo, it was revealed today.
The news comes as Vauld announced the shutdown of withdrawal and exchange services on its platform yesterday, Monday 4 July. The news directly affects over 800,000 users. Nexo said it wanted to “provide immediate assistance and alleviate withdrawal restrictions on the Vauld platform”, according to a statement.
The two entities are currently in talks, according to Darshan Bathija, one of the co-founders of Vauld. If the negotiations are successful and the acquisition is confirmed, Nexo will acquire 100% of Vauld’s shares.
I understand that a lot of our customers are nervous about your funds. We are working tirelessly to ensure your financials are protected. To that end, we’ve signed an indicative term sheet with @Nexo to acquire up to 100% of Vauld: https://t.co/HrnQO7J64f
– Darshan Bathija (@darshanbathija) July 5, 2022
I understand that many of our clients are nervous about their funds. We work tirelessly to ensure that your finances are protected. To that end, we have signed an indicative term sheet with Nexo to acquire up to 100% of Vauld. “
The companies have both signed a document giving Nexo a 60-day exploratory period to allow the platform to closely study the state of Vauld’s accounts, as confirmed by Antoni Trenchev, co-founder of Nexo, in an interview with The Block:
We need to see what exactly is in their books and that will take some time. But as we have the exclusive right to the exploratory period, we are the only ones looking at them at the moment. “
An opening for the Asian market
As a platform operating in the Asian market, the acquisition of Vauld is a serious strategic asset for Nexo. This was confirmed by Antoni Trenchev, who said that Vauld had “huge traction in India and South East Asia, which are important markets for us.”
The announcement is reminiscent of Nexo’s proposal to buy Celsius’ assets last month, which was also in a critical situation. However, after a week’s consideration, Celsius did not pursue the proposal.
Vauld, however, seems more inclined to accept Nexo’s proposal. This is understandable: according to a person close to the company, Vauld has tens of millions of dollars in debts following the collapse of the market.
For Darshan Bathija, such a deal could only benefit both entities:
Operating under the Nexo umbrella instantly puts us in a strong position to continue to meet our fiduciary obligations to our clients and, at the same time, to implement the ambitious roadmaps of both companies, regardless of market conditions.
In its press release, Nexo defines itself as one of the few companies able to turn around some of the struggling players. According to the company, it is up to the few “competent and well-capitalised entities” to find solutions and help the sector.
Regulators are still paying close attention to the consequences of possible insolvency concerns of cryptocurrency players. Indeed, only hours after Vauld’s announcement on Monday, Singapore’s central bank said it was considering new legislation to better protect consumers.
