Babel Finance moves to delay debt payments, and denies involvement with 3AC

Babel Finance, a crypto lending company, abruptly stopped client withdrawals and redemptions last Friday for all products. BloombergAfter reaching agreements with key counterparts and customers, it was determined that the company would delay its debt repayments. However, It’s still uncertain when the company will resume withdrawals and redemptions.

In a statement, the Hong Kong-based crypto-firm stated that the preliminary agreement on reprieving debt repayments had relieved short-term liquidity pressures. After an emergency assessment of the company’s business operations, the relief was granted.

The troubled crypto lender is in conversations with large institutions for solutions, including “setting up a new entity to take up some of the debts.”

In the wake of Celsius blocking all withdrawals, swaps, and transfers between accounts and failing to provide an immediate solution to its users, Babel Finance followed a similar approach last Friday, citing extreme market conditions and liquidity issues as the reason behind such a move.

According to reports, the crypto company refuted the notion that it had told its investors that it was insolvent. In terms of the speculation regarding its liquidity crisis, the firm clarified that it had no business with the crypto hedge fund Three Arrow Capital, which, reported earlier, sought bailouts through “asset sale and a rescue by another firm.”

Though the company noted that it would “provide updates in a timely and transparent manner,” it did not release details regarding when the platform will let users withdraw their funds.

In a previous funding round backed by renowned VCs such as Sequoia Capital China, Jeneration Capital, Dan Tapiero’s 10T Holdings, and Dragonfly Capital last month, the firm was valued at $2 billion after raising $80 million. However, the company still had a balance outstanding of more than 3 billion dollars at the end last year. Bloomberg stated.

Get latest news from African Startup ecosystem

Latest stories

You might also like...