Nexo Capital has accused its rival, crypto lending firm Vauld of not acting in the best interests of its creditors. Nexo is currently in the process of trying to acquire Vauld, but the company is rebuffing it and instead pushing for a “questionable” deal with an affiliated fund manager, according to a letter from Nexo. This alternative arrangement, the letter claims, could lead to the loss of assets for Vauld and heavy management fees. Nexo has urged creditors to seek an independent third-party administrator to ensure fairness in the voting process and results. Vauld has not yet commented on the matter.
This conflict between the two firms is the latest setback for the crypto lending industry, which has also seen issues with Celsius Network filing for bankruptcy, big layoffs at Genesis Global Trading, and significant losses for Silvergate Capital Corp. Both Nexo and Vauld have also experienced their own difficulties.
Nexo, announced last month that it is phasing out its products and services in the US, after facing multiple cease-and-desist orders from regulators over its interest-earning products. The company is also being sued in London by investors who allege that they were prevented from withdrawing parts of their $126 million in assets from the platform in March 2021, when the price of Bitcoin surpassed $54,000.
Vauld froze customer withdrawals in July and hired advisers to explore a restructuring. The company now has until January 20th to present a restructuring plan to creditors. It had previously raised $25 million in a funding round led by Valar Ventures, and had investments from Coinbase Ventures and Pantera Capital.