MintGenie Explainer: What exactly is the Vauld issue and how does it impact you?

livemint.com:

As one percent TDS came into force from July 1 onwards, several crypto investors have become too dissuaded to invest their money, or at least the data shows this. No prizes for guessing then the trading volumes at several Indian crypto exchanges have dropped sharply.

Co-founded by Darshan Bathija, Singapore-based crypto platform Vauld recently suspended its withdrawals, trading and deposits.

The news of pausing of withdrawals followed an announcement recently that Vauld was firing 30 percent of its staff last month.

What went wrong?

Vauld said that the suspension of withdrawals was the result of massive customer withdrawals amounting to over $197.7 million since June 12, 2022.

The company on Tuesday announced that there could be a solution in sight as Nexo, lender in digital finance space, starts the process to acquire Vauld.

"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," said Darshan Bathija in a statement issued on Tuesday.

About Vauld discontinuing the withdrawals, Gaurav Mehta, Founder of Catax, says: "It illustrates the sorry state of affairs in India, where fintech innovation and risky endeavours are shielded by corporate restructuring abroad and Indian customer’s investments is a mercy for foreign companies."

What can investors do now?

This sudden move caught a number of investors unaware. Puneeth-K, one of the user on reddit, a social news discussion portal, said, “Learnt my lesson after losing lakh worth of coins on a good day (seems so long ago now) but never again falling for advices from YouTubers they are just cynics aiming