Babel Finance has suspended redemptions and withdrawals on its platform until further notice, per details from an announcement released on Friday.
According to the statement, the service has halted some features due to unusual liquidity pressure. Babel also cited conductive risk events experienced by some companies amid heavy fluctuations and volatility in the crypto market.
Due to the current situation, Babel Finance is facing unusual liquidity pressures. We are in close communication with all related parties on the actions we are taking in order to best protect our customers. During this period, redemptions and withdrawals from Babel Finance products will be temporarily suspended, and resumption of normal service be notified separately.
The crypto lending and digital asset service provider mammoth launched in 2018. Based in Hong Kong, the company is valued at $2 billion following a recent $80 million Series B funding round.
It remains unclear if Babel is faced with the same liquidation events and margin calls currently looming over crypto hedge fund Three Arrows Capital
Tether CTO Confirms Babel Finance Has No Open Positions On Bitfinex
According to WuBlockchain, Tether’s Chief Technology Officer Paolo Ardoino confirmed that Babel Finance closed their positions.
Bitfinex(Tether): 3AC closed all their positions and remained with small positive equity, we didn't liquidated them; Babel closed all their borrowing positions sometime ago, No issues there as well. @paoloardoino said. https://t.co/frPrE3a0lP
— Wu Blockchain (@WuBlockchain) June 17, 2022
However, FatManTerra, a community member from Terra claims to have inside knowledge on the matter. FatManTerra tweeted that the crypto lender supposedly has considerable losses on an unnamed platform. The pseudonymous account also claims to know one of Babel’s lenders, a market maker called Genesis Trading.
Update: I can confirm that one of Babel's lenders is Genesis Trading, a behemoth crypto market maker. Babel has not yet been liquidated, but sources close to the matter inform me that it is being considered. Genesis will likely face zero losses.
— FatMan (@FatManTerra) June 17, 2022
