Crypto Lender Babel Obtains Extended Creditor Protection in Singapore

[ad_1]

Struggling cryptocurrency lending firm Babel Finance has more time to pay off debts to creditors like Deribit after suspending withdrawals in 2022.

A Singapore court has extended Babel Finance’s creditor protection for three months, Bloomberg reported on April 18.

According to Babel co-founder and former CEO Flex Yang, the moratorium will last until July 21, allowing the company to continue with its restructuring plan through a new decentralized finance (DeFi) project called Hope. Flex returned to oversee Babels’ restructuring process a few years after stepping down as CEO in 2021.

Flex Yang, former CEO of Babel Finance and founder of the Hope DeFi ecosystem. Source: TechCrunch

Babels’ restructuring plan involves new tokens called Babel Recovery Coins, which aim to allow the struggling lender to generate revenue to repay up to $800 million to its creditors.

Flex also wrote in an open letter on Twitter that Babels’ bankruptcy protection was heard in the High Court of Singapore on April 17, officially opening the judicial reorganization proceedings. He noted that his main focus going forward would be Project Hope, stating:

In the upcoming international political changes, HOPE will be an important tool for us to reconnect the world. […] We are confident that our new team will continue to use their hope and light to drive the new project forward.

As previously reported, the Flex co-founder launched the Hope DeFi project in mid-March 2023, positioning the initiative as a combination of DeFi and centralized funding to enable DeFi-level transparency and security and centralized access. at the financial level.

Related: Celsius Reportedly Prepared Litigation Against Creditor For Leaking Inside Information

Another Babel co-founder, Yang Zhou, originally pitched Project Hope in early March, describing his native Babel Recovery Coin as a stablecoin minted as collateral based on Bitcoin (BTC) and Ether (ETH). The token is designed to maintain its 1:1 peg to the US dollar through arbitrage incentives for traders.

Babel was one of several crypto lending companies that experienced major liquidity issues due to the 2022 crypto bear market. The Hong Kong-based company suspended withdrawals and redemptions of its products in June, citing unusual liquidity pressures. Babel reportedly lost $280 million in proprietary trades with client funds.

Magazine: Asia Express: the glory of Bitcoin on the Chinese TikTok, 30 million users on the continent, the Justin Sun saga

[ad_2]