Babel Finance suspends withdrawals after Celsius; The Amber Group clarifies its position

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Crypto financial services provider Babel Finance halted withdrawals and redemptions amid a market meltdown, shortly after Celsius did the same, citing ‘liquidity pressure’

In a recent statement, the Hong Kong-based crypto lender said that due to “the state of the current crypto market, its fluctuations and the conductive risk factors faced by some institutions”, Babel Finance is facing “unusual” liquidity pressures.

The provider further added that “the resumption of normal service will be notified separately”, while apologizing to its investors.

Babel follows the Celsius route

On June 13, Celsius also suspended withdrawals, trades and transfers for its users “due to extreme market conditions”.

Notably, Babel Finance currently limits its activities to Bitcoin (BTC), Ethereum (ETH) and stablecoins, while serving a select customer base of approximately 500 clients. With this, at end of 2021the company had a balance owing of more than $3 billion and an average monthly trading volume of $800 million in derivatives.

That said, more steps are yet to be revealed by the platform as to how it plans to handle the crisis.

On the contrary, Celsius has reportedly hired Citigroup as an “advisor” as it continues to plunge this month due to the sale of large whales. Celsius is said to have a customer base of 1.7 million users.

Amber says ‘business as usual’ amid market crash

The already weak crypto market has grown from a cumulative global market cap of $1.3 trillion to $937 billion in just over a week. The BTC king coin has 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, meanwhile said in a blog post that it was “business as usual” for them despite the market risks. Amber said: “To date, we have never engaged in any activity involving the underwriting of borrowers’ credit risk and have no plans to do so in the future.”

The company also confirmed that it had “no risk exposure” to any of the market participants with possible “credit issues”. The digital asset company therefore assured that all products and services “will continue to operate as usual, with no interruption of trading, earning and dual currency products, deposits and withdrawals”.

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