cryptoknowmics.com
Babel Finance, a Hong Kong-based crypto lending service, has resolved some of its immediate liquidity issues by establishing debt repayment agreements with a few of its counterparties. Following "extraordinary liquidity challenges" in the current bear market, the firm ordered a temporary suspension of redemptions and withdrawals from its products on Friday, as previously reported. The firm indicated that it was acting quickly to protect clients and communicate with "all involved parties." Babel Finance claimed in a Monday update that it has taken three initiatives to help alleviate its present liquidity problem. Among them are performing an emergency review of the company's business activities, engaging with shareholders/investors, and negotiating "preliminary agreements" for some debt repayments. The corporation did not provide specifics on the debt repayment options, such as interest rates or maturity dates, but did state that:
"We have communicated with major counterparties and relevant customers and reached preliminary agreements on the repayment period of some debts, which has eased the company's short-term liquidity pressure."
Babel Finance's Shareholders and Investors
The company also indicated that it informed some shareholders and investors about the possibility of obtaining liquidity help and that it will "actively fulfil its legal obligations to customers and endeavour to avoid future transmission and dispersion of liquidity concerns." The company's cash problems came barely a month after raising $80 million in a Series B investment round at a $2 billion value. Zoo Capital, Sequoia Capital China, Dragonfly Capital, and Tiger Global Management led a $40 million Series A fundraising round for the company last year. According to the company, Babel Finance provides financial exposure to Bitcoin (BTC), Ether (ETH), and stablecoins to a "limited clientele of roughly 500 customers."