Babel Finance withdrawals: When will crypto lending platform resume redemptions?
Uncertainty remains over Babel’s operations, with users locked out of accounts for the time being
Update 21 June 16:40 BST (UTC+1): Babel Finance’s official Twitter account has been suspended. As yet, no clear reason for the ban has been given.
On Friday 17 June, crypto lending platform Babel Finance announced a freeze on withdrawals and redemptions of all users’ digital assets.
As reported by Reuters, the Hong Kong-based enterprise faced “unusual liquidity pressures” due to the ongoing market downturn. The news followed a spate of similar instances in the beleaguered crypto markets, including the ongoing $20bn crisis facing the US-based lending giant Celsius.
As of 20 June at 14:30 BST (UTC+1), Babel customers remain locked out of their accounts, many of which belong to high net worth individuals. The question on everyone’s lips, therefore, is: when will Babel Finance resume redemptions?
When will Babel resume redemptions?
In an announcement posted on Babel’s official website on Monday 20 June, the company stated: “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.”
In the note, Babel also pledged to “fulfill its legal responsibilities to customers and strive to avoid further transmission and diffusion of liquidity risks”.
Stakeholders are likely to be underwhelmed by the paucity of information presented here. Who are these counterparties? What is the company’s roadmap to liquidity? How will Babel continue to support the community through the situation?
While Babel does not have an official Telegram page, it does have an official Twitter account, which had been silent since 17 June until a couple of retweets appeared on 20 June that echoed what was expressed in the company’s announcement. Currency.com has reached out via email to request further information.
Unfortunately for anxious customers, there is currently no concrete timeframe. If Celsius is anything to go by, it could be a while yet.
One week on, and the once-leading crypto lender has yet to resume normal service, warning in a 20 June blog post that “this process will take time”.
Babel Finance users are advised to keep a keen eye on the company’s official Twitter stream for announcements. Currency.com will be sure to keep you updated as the situation progresses.
Babel Finance: A brief backstory
Hong Kong-based Babel Finance was first launched as Babel Bank in March 2018 by Flex Yang and Del Wang. The self-styled “commercial crypto financial institution” secured a series of high-value investment rounds in the following years and by March 2021, the platform had more than 500 global clients with an outstanding loan balance of $2bn.
In July 2021, fintech investor Edmond Lau came aboard as chief financial officer while Shanshan Yu was hired in September 2021 to oversee operations of Babel Asia, a newly-launched entity in Singapore.
In June 2022, withdrawals stopped and redemptions were frozen on Babel Finance due to adverse market conditions, leading to concerns over the future of the enterprise.
When will Babel Finance resume redemptions?
Unfortunately, there is no clear way of knowing when crypto withdrawals will resume on Babel Finance. Currency.com will keep you updated as the situation continues.
What is Babel Finance?
Babel Finance is a crypto lending platform for institutional investors. Loans are primarily collateralised with Bitcoin. Babel also provides wealth-management services.
Where is Babel Finance located?
Babel Finance is headquartered in Hong Kong. Sister company Babel Asia is based in Singapore.