Babel Finance, a Hong Kong-based crypto lending company, has resolved some of its short-term liquidity issues by striking debt repayment agreements with several of its counterparties. The firm stated that it will actively fulfill its legal commitments to avoid further transmission and diffusion of liquidity risks.
On Friday, the firm announced a temporary suspension of redemptions and withdrawals from its products, citing “exceptional liquidity concerns” in the present bear market, as previously reported. The firm indicated that it was moving quickly to protect clients and engage with “all involved parties.
Babel Finance said it has taken three initiatives to help improve its present liquidity crisis, according to a Monday report. These include conducting an emergency review of the company’s operations, talking with shareholders and investors, and negotiating “preliminary agreements” for some debt repayments.
The company also announced that it informed some shareholders and investors about the possibility of receiving liquidity support. “We appreciate our clients’ patience and support during this time, and we look forward to receiving additional assistance from our partners,” the company said.
The company’s liquidity troubles have arisen just a month after raising $80 million in a Series B investment round at a $2 billion value. The year prior, the firm also raised $40 million in a Series A funding round led by Zoo Capital, Sequoia Capital China, Dragonfly Capital and Tiger Global Management.
According to the company, Babel Finance provides a “exclusive clientele of roughly 500 consumers” with financial exposure to Bitcoin (BTC), Ether (ETH), and stablecoins.
According to an analyst, crypto financing can survive the downturn market.
