$2 billion lending giant Babel Finance is on the verge of collapse. Babel Finance, a crypto lender, located out of Hong Kong, is suspending withdrawals because, according to a statement they issued, “they are facing unusual liquidity pressures. “
“Recently, the crypto market has seen downfall, and industry have experienced conductive risk events. Due to the current situation, Babel Finance is facing unusual liquidity pressures,” the company said.
Crypto lenders gather crypto deposits from retail customers and re-invest them, proclaiming double-digit returns and attracting tens of billions of dollars in assets. However, the recent meltdown has lenders unable to redeem their clients’ assets. (1)
The company had a loan balance of nearly $3 billion at the end of 2021, up from $2 billion the previous February
Babel Finance stated that it would actively fulfill its legal responsibilities to customers and try to avoid further transmission. However, it’s still uncertain when the company will resume withdrawals and redemptions.