Crypto financial service provider Babel Finance has halted withdrawals and redemptions amid a market slump, soon after Celsius did the same, citing ‘liquidity pressure’
In a recent release, the Hong Kong-based crypto lender has stated that due to the ‘condition of the current crypto market, its fluctuations, and conductive risk factors faced by some institutions,’ Babel Finance is facing ‘unusual’ liquidity pressures.
The provider further added that ‘resumption of normal service be notified separately,’ while apologizing to its investors.
Babel follows the Celsius route
Back on June 13, Celsius had also suspended withdrawals, swaps, and transfers for its users “due to extreme market conditions”.
Notably, Babel Finance currently limits its business to Bitcoin (BTC), Ethereum (ETH), and stablecoins, while serving a select clientele of approximately 500 customers. With that, at the end of 2021, the company had a balance owed of more than $3 billion and an average monthly trading volume of $800 million in derivatives.
That said, further steps are yet to be revealed by the platform as to how it plans to handle the crisis.
Contrarily, Celsius has reportedly hired Citigroup in an “advisory capacity” as it continues to plunge this month, owing to large whales undertaking a sell-off. Celsius is quoted to have a client base of 1.7 million users.
Amber says ‘business as usual’ amid market slump
The already weak crypto market had spiraled down from a cumulative global cryptocurrency market cap of $1.3 trillion to $937 billion in just over a week. The king coin BTC also lost over 34% of its value in the past seven days on CoinGecko and is still hovering around $20,000 at the time of writing.
Amber Group, another leading digital asset company, has meanwhile stated in a blog post that it is ‘business as usual’ for them despite the market risks. Amber said, “To date, we have never engaged in any business that involves underwriting credit risk of borrowers, and have no plans to in the future.”
The company also confirmed that they have “zero risk exposure” to any of the market participants with possible “solvency issues”. The digital asset company hence ensured that all products and services will “continue to function as usual, with no disruption to trading, earn, and dual-currency products, deposits, and withdrawals.”
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Source: https://beincrypto.com/babel-pauses-withdrawals-amber-group-clarifies-position/