Vauld promised liquidity on June 16 — froze withdrawals on July 4

Vauld, a Singapore-based crypto lender roughly three years old and backed by Valar Ventures, Coinbase Ventures and Pantera Capital after raising about $27 million, sold yield: up to 12.68% a year on stablecoins and 6.7% on bitcoin and ether. On 16 June 2022 its chief executive, Darshan Bathija, assured customers that the platform was liquid, had no exposure to Celsius or Three Arrows Capital, and would keep processing withdrawals as usual.

The market ruled otherwise. Terra's collapse, Celsius's withdrawal pause and Three Arrows Capital's liquidation had already hit the crypto-lending sector, and bitcoin had lost about half its value since early May. Between 12 June and 4 July customers pulled US$197.7 million out of Vauld. On 4 July the firm suspended withdrawals, trading and deposits with immediate effect, citing financial challenges from volatile markets and the difficulties of key business partners — two weeks after cutting 30% of its workforce.

What followed was the restructuring kit: Kroll engaged as financial adviser, law firms in Singapore and India appointed, talks with potential investors opened, and an intended application to the Singapore courts for a moratorium to pause proceedings while options were explored. The lender that had promised liquidity eighteen days earlier was asking a court for protection from its own depositors.