The Singaporean crypto exchange Vauld is the latest to join the bandwagon of wounded crypto firms. On Monday, the firm announced that it was freezing all withdrawals, deposits, and trading provisions across its platform due to "financial challenges."

"We believe that this will help to facilitate our exploration of the suitability of potential restructuring options, together with our financial and legal advisors. We seek the understanding of customers of the Vauld platform that we will not be in a position to process any new or further requests or instructions in this regard. Specific arrangements will be made for customer deposits as may be necessary for certain customers to meet margin calls in connection with collateralised loans," the firm's announcement post explained.

Not long ago, firms such as the US-based Celsius Network and Singapore-based 3 Arrows Capital reached the same stage following the Terra catastrophe of May 2022. Ironically, these three factors, coupled with the harsh crypto winter, have led to massive customer withdrawals on the Vauld platform.

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In the announcement blog post, Darshan Bathija, CEO of Vauld, wrote that their precarious position was the courtesy of "the volatile market conditions, the financial difficulties of our key business partners inevitably affecting us, and the current market climate which has led to a significant amount of customer withdrawals in excess of a $197.7 million since 12th June."

Vauld also announced last month that 30 percent of its workforce would get the axe. Most of that workforce is based out of India. The firm had said it needed to cut marketing expenses, suspend hiring, and even slash salaries by 50 percent.

Vauld has raised $27 million from big names in the space such as Coinbase, Pantera Capital, and Valar Ventures (backed by Peter Thiel). Its DeFi services include crypto-backed lending and borrowing as well as fixed deposits.

The move to freeze withdrawals is quite surprising, given that the company boasted $1 billion in assets under management just a couple of months ago. Even more surprising is that on June 16, a company email stated that business would "continue to operate as usual." A little over a fortnight later, the company has put the brakes on withdrawals and is now considering restructuring options.

To help plot a way forward, Vauld has sought the services of financial advisor Kroll Pte Limited and the legal advisement of Rajah & Tann Singapore LLP and Cyril Amarchand Mangaldas for its Singapore and India arms.

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Vauld is contemplating a moratorium approach as the immediate mitigation measure to hold off the impending doom. It will file for the moratorium with Singaporean courts. "A suspension of the commencement or continuation of any proceedings against the relevant companies so as to give us breathing space to carry out the proposed restructuring exercise," said Bathija.

The current bear market blues have had far reaching effects on the crypto market, and DeFi lending firms have been hit particularly hard. In mid-june, another crypto lender, BlockFi, was on the brink of insolvency, reaching out to crypto exchange FTX for a $250 million emergency line of credit. It too had slashed its employee strength by 20 percent and tried to slow withdrawals by raising deposit rates and eliminating free withdrawals.