Crypto lender Vauld vetoes acquisition of Nexo

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Crypto lender Vauld has reportedly canceled an acquisition by rival Nexo.

We were previously exploring a potential acquisition by Nexo as part of the proposed restructuring plan, Vauld said in a private Twitter post, posted by Coinbase on Monday (Dec. 26). To sum up very briefly, our discussions with Nexo have unfortunately not been successful.

However, a source familiar with the deal said talks were still ongoing with Nexo still showing interest in the deal, the outlet reported.

Nexo has not given up on its attempt to save Vauld and help its creditors recover as much platform funds as possible, co-founder and managing partner Kalin Metodiev told Coinbase.

The potential collapse of the deal comes less than a month before Vauld submits a restructuring report to its creditors.

The Singapore-based company filed for bankruptcy protection in July after suspending withdrawals, part of a series of crypto companies ceasing trading on their platforms due to a volatile digital asset market.

Clients had withdrawn around $200 million worth of crypto from the platform since June. Vauld also laid off about 30% of its workforce, slowed hiring and cut executive pay in half.

Nexo announced its intention to buy Vauld in July, saying it would revamp its future operations in a bid to accelerate its deeper presence in Asia.

However, months of talks to finalize this agreement would have yielded little result. In an email to creditors, published by Bloomberg News, Nexo said it encountered difficulties during the months of talks, including defamation and spreading false information on social media.

Another issue: Nexos’ decision earlier this month to wind down operations in the United States, saying it was at an impasse in talks with state and federal regulators.

It is now sadly clear to us that despite rhetoric to the contrary, the United States refuses to provide a path forward to enable blockchain businesses and we cannot assure our clients that regulators are focused on their best interests, Nexo said in a blog post.

This is bad news for Vauld, the Bloomberg report notes, as 40% of its US clients would see no benefit from acquiring Nexo.

The Vauld and Nexos issues come at the end of a year in which, as PYMNTS wrote last week, the cryptocurrency industry has fully entered the mainstream and nearly drowned. .

The industry, whose roots can be traced back to the 2008 recession, hadn’t existed for anything like it since or endured a broader macro ecosystem destabilized by both interest rates and inflation soaring to new heights. historic levels.

Monetary policy tightening and investor withdrawals took the fledgling industry by surprise, slashing the value of the crypto market by around $1.4 trillion, a nearly 50% drop from its baseline. 2021 high of $3 trillion.

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