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Babel Finance Seals Debt Payment Deal Amid Liquidity Crisis

The crypto lender said it carried out an emergency assessment of its business operations to determine the company’s liquidity status.


North Korean hackers are among the biggest losers in the crypto crash, as the secretive nation relies heavily on ill-gotten digital gains for foreign exchange.
North Korea has poured resources into stealing crypto in recent years, making it a potent hacking threat and leading to one of the largest cryptocurrency heists on record in March. File photo: Reuters.

 

Hong Kong-based crypto lender Babel Finance said it has reached a deal with counter-parties on the repayment of debt to ease short-term liquidity.

Babel Finance suspended withdrawals and redemption of crypto assets on Friday.

Cryptocurrency valuations have plunged in recent weeks as investors dump risky assets in a rising interest rate environment.

Bitcoin, which reached a record high of $69,000 in November, has lost more than half its value this year.

In an update on its website on Monday, Babel said it carried out an emergency assessment of its business operations to determine the company’s liquidity status.

Crypto lenders gather crypto deposits from retail customers and re-invest them, proclaiming double-digit returns and attracting tens of billions of dollars in assets. However, lenders have been unable to redeem their clients’ assets during the recent meltdown.

“Babel Finance will actively fulfill its legal responsibilities to customers and strive to avoid further transmission and diffusion of liquidity risks,” the company said.

Babel, which has 500 clients and only deals in bitcoin, ethereum and stablecoins, raised $80 million in a funding round last month, valuing it at $2 billion. It had ended last year with $3 billion of loan balances on its balance sheet.

 

  • Reuters with additional editing by Jim Pollard

 

 

 

 

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Jim Pollard

Jim Pollard is an Australian journalist based in Thailand since 1999. He worked for News Ltd papers in Sydney, Perth, London and Melbourne before travelling through SE Asia in the late 90s. He was a senior editor at The Nation for 17+ years and has a family in Bangkok.

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