According to The Block, Babel Finance, the crypto lender that unexpectedly froze withdrawals last week, has revealed multiple efforts to address its liquidity issue.
Improving the liquidity situation
Babel Finance stated that it conducted an emergency assessment of its business operations to understand its liquidity status and that it has also reached preliminary agreements with major counterparties and customers on the repayment period of some debts, alleviating the company’s short-term liquidity pressure.
The announcement does not mean that withdrawals are available again; they are still suspended. However, the business has actively communicated with shareholders and investors and will continue to communicate and seek liquidity assistance.
What is Babel Finance?
Babel Finance, located in Hong Kong, was founded in 2018 to provide lending and trading services to institutional investors. As of last month, it claimed to have 500 clients and 170 staff. Jeneration Capital, Dan Tapiero’s 10T Holdings, Dragonfly Capital, and Circle Ventures are among the platform’s investors.
While there were rumors of Babel Finance’s insolvency due to its exposure to failing crypto hedge fund Three Arrows Capital, the firm denied informing partners of its insolvency. It stated that it had no business with Three Arrows Capital.