Singapore Supreme Court Grants Crypto Vuld Lender Temporary Protection from Creditors – Bitcoin News

Singapore-based Fuld will have some breathing room after the country’s Supreme Court granted parent company protection to creditors for the next three months. The decision comes as the struggling crypto-lending platform seeks to acquire rival Nexo.

Fuld will receive 3 months of restructuring and due diligence from Nexo

Bloomberg reports that the Singapore Supreme Court has awarded the parent company of cryptocurrency lender Fuld, Defi Payments Ltd. , a three-month protection period from creditors, noting that this would allow Fuld to restructure and prepare for a possible takeover by rival Nexo, a major player. in the cryptocurrency lending market.

Judge Idit Abdullah agreed to postpone the work until November 7 during a court hearing on Monday. During the said period, Fuld’s 147,000 creditors will be prevented from taking legal action against him. She requested another three months, but the judge expressed concerns that the six-month protection would not guarantee “appropriate supervision and monitoring.”

He noted, however, that the moratorium could be extended based on an assessment of the company’s involvement with creditors. Its progress in this regard will be taken into account at the next hearing. Abdullah demanded that the company form a creditors committee to address the pending issues in the meantime.

The judge added that the crypto lender is also expected to provide details, including cash flow and asset valuation, to its creditors within two weeks and regarding the management of its accounts within eight weeks.

The report notes that a series of failures in the crypto lending sector will likely lead to more regulatory scrutiny. Companies such as Voyager Digital, Babel Finance, and Celsius Network have been hit by the crypto market downturn this year. Singapore’s central bank has already indicated that it is considering introducing more consumer protection measures in the cryptocurrency space.

Nexo optimistic about potential acquisition of Fuld

Soon after reassuring clients about the health of her business in mid-June, Fuld began laying off employees. On July 4, it announced the suspension of its withdrawals and began talks with Nexo seeking to sell itself to its competitor.

The two signed an indicative term sheet that gives Nexo a 60-day exploration period for a potential acquisition. According to creditors’ correspondence sent by CEO Darshan Bhattija on July 11, Fuld had $330 million in assets and $400 million in liabilities at the group level.

Anthony Trenchev, co-founder and managing partner of Nexo, told Bloomberg that the lender remains optimistic about the deal while also noting that it will take time to “understand the obligations and receivables, who the counterparties are and what the odds are of getting those receivables” and all other aspects in order to take action. decision on the matter.

An attorney representing Defi Payments, Sheila Ng, said the company will allow a minimum withdrawal for its creditors, given the court’s decision. The move will worry Fuld users with cryptocurrency balances in their accounts, institutional lenders who lent money to Defi Payments, and suppliers.

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Do you think three months will be enough for Fuld to restructure and end a deal with Nexo? Share your predictions in the comments section below.

Lubomir Tasev

Lubomir Tasev is an Eastern European journalist and technology expert, who likes to quote Hitchens: “Being a writer is what I am, not what I do.” Besides crypto, blockchain, and fintech, international politics and economics are other sources of inspiration.

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