Crypto Lending Platform Babel Finance Reaches Counterparty Debt Agreement

Hong Kong-based crypto lending firm Babel Finance has eased some of the immediate liquidity issues by entering into debt repayment agreements with some counterparties.

As previously reported, the company issue a temporary suspension Redemption and withdrawal of its products on June 17 after citing “abnormal liquidity stress” in the current bear market. The company said it was taking swift action to protect customers and communicate with “all parties involved.”

in update post On June 20, Babel Finance said it has since taken three steps to help ease its current liquidity situation. These include: conducting an urgent assessment of the company’s business operations, communicating with shareholders/investors, and reaching a “preliminary agreement” on certain debt repayments.

The company didn’t specify the specifics of the debt repayment plan, such as interest rates or maturity dates, but did state:

“We communicated with major counterparties and related customers, and reached a preliminary agreement on the repayment period of some debts, which eased the company’s short-term liquidity pressure.”

The company also said that it has communicated with some shareholders and investors about the possibility of obtaining liquidity support, and will “actively fulfill its legal responsibilities to customers and strive to avoid further transmission and spread of liquidity risks.”

“We appreciate our customers’ understanding and support during this time and look forward to further support from our partners,” the company said.

The company has liquidity problems just a month after raising $80 million in Series B funding round Valuation is $2 billion.The year before, the company also $40 million raised Series A financing led by Zoo Capital, Sequoia Capital China, Dragonfly Capital and Tiger Global Fund.

According to the company, Babel Finance provides financial exposure to bitcoin (BTC), ether (ETH), and stablecoins to “a select group of around 500 clients.”

related: Crypto Lending Can Still Survive Bear Market, Analyst Says

The company has joined many Crypto Firms Facing Liquidity Issues In the current bear market, including Three Arrows Capital, Celsius, and Finbloxto name a few, the latter two are also moved to Withdrawals suspended.