Babel Finance, an asset management firm based in Hong Kong, has become the latest cryptocurrency lending platform to announce facing liquidity issues amid the market recession.
Babel Finance announced on Friday that it temporarily suspended redemptions and withdrawals from the platform. The announcement is similar to the one made by the Celsius Network, halting the same services.
Babel Finance halts withdrawals
On Friday, Babel Finance announced it was temporarily suspending some services because of the ongoing market recession. “Recently, the crypto market has seen major fluctuations, and some institutions in the industry have experienced conducive risk events,” the company said.
The firm also added that it was in close talks with the relevant parties on the issue and was doing its best to protect its customers. Babel Finance is a leading cryptocurrency company founded in 2018. The company offers a wide range of services, from cryptocurrency lending, asset management, and financing to institutional clients.
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“Babel Finance is taking action to best protect the interests of our clients. We are in close communication with all related parties and will share updates in a timely manner,” said a spokesperson from the exchange.
The exchange’s operations seem to have been going well before the market took a massive dive. The average monthly trading volumes on the exchange came in at around $8 billion. The company raised $40M early last month in a Series A funding round. The funding round was supported by some of the leading companies in the space, including Dragonfly Capital, Sequoia Capital China, Tiger Global Management, and Zoo Capital.
Crypto firms face liquidity issues
The current bear market seems to be affecting many cryptocurrency businesses. The market conditions are triggering selloffs, which is, in turn, causing issues with liquidity. Celsius became the first crypto lending firm to halt withdrawals, swaps, and transfers because of the market conditions.
Some leading cryptocurrency exchanges are also laying off staff because of the tough market conditions. Coinbase, Gemini, and CryptoCom have announced they will be firing some of their staff.
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