Bitcoin, the world’s largest cryptocurrency, has declined by more than 50% since the beginning of 2022.
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Vauld, a confused crypto lender, has been thrown out of lifelines by its larger competitor, Nexo, as a sign of ongoing integration in the crypto market.
Nexo said Tuesday that it had signed a term sheet with Vauld and had a 60-day exclusive deal to consider the acquisition of all of the company’s shares. If successful, Nexo said it plans to reorganize the company and pursue business expansion in Southeast Asia and India.
Monday Vauld Paused operation He said he was exploring restructuring options because of the “financial challenges” caused by the plunge in cryptocurrencies. This Singapore-based company Coinbase And Silicon Valley billionaires Peter thiel..
It’s the latest company to be caught up in the turmoil that has recently dominated the world of cryptocurrencies. Last month alone, another crypto lending company, Celsius, suspended its withdrawal indefinitely because of “extreme market conditions.” Meanwhile, the crypto hedge fund Three Arrows Capital filed for bankruptcy protection a few days after it collapsed into liquidation.
Asked how much Nexo is willing to pay Vauld, co-founder Antonio Trenchev said it was “premature” to talk about the assessment at this stage. But he added that he was “optimistic” about reaching a deal.
“We are starting due diligence,” Nexo’s chief told CNBC. “There is a 60-day monopoly period and you can open the book. You will see everything. Is there a hole? How big is the hole? Where are the assets? Who is the counterparty?”
Nexo had previously submitted a letter of intent to acquire the company to Celsius, but said the company declined the offer.
Since there is no government to rely on, some crypto companies have instead sought the help of their peers in hopes of relief.
Sambankman Fried, the billionaire behind the crypto exchange FTX, Lender of last resort For the industry.Last week FTX signed a deal giving it an option Buy cryptocurrency lending company BlockFiBankman-Fried’s Quants Trading Shop Alameda Research Extend your credit line Last week, to the embarrassed crypto broker Voyager Digital Frozen all operations..
Trenchev compared the current market situation with the Panic of 1907, a series of run runs before the Federal Reserve was established in 1913. The remaining lenders who survived the crash were rescued because there was no central bank to rely on at the time.Leading financial companies, especially JP Morgan..
“I think it’s time for consolidations, mergers and acquisitions. Eventually there will be fewer companies, but stronger companies will have better business practices,” he said.
Bitcoin Worst month on record In June, more than 38% of its value was lost. The world’s largest cryptocurrency has declined by more than 50% since its inception in 2022.