Crypto lender Babel Finance to undergo restructuring

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Babel Finance has filed for a moratorium in Singapore to restructure its financial position and repay creditors.

Upon the filing, the Hong Kong- and Singapore-based crypto broker will automatically receive a moratorium for 30 days or until the date when the application is heard – whichever comes first. But to get a moratorium, it must first meet requirements such as a list of creditors and evidence of support from them.

A company spokesperson told Tech in Asia that Babel Finance has drawn some interest from investors to relaunch its business, including co-founder Flex Yang.

According to a Bloomberg report, Babel Finance is looking to introduce “Babel Recovery Coins.” Yang is also working on a crypto project called Hope, whose token will peg its value to the dollar. However, it will use Bitcoin and Ether as collateral instead of cash and cash-equivalent assets, which are favored by other stablecoins.

Babel Recovery Coins will be distributed to stakeholders, the company confirmed to Tech in Asia, while the Hope stablecoin will be used to launch the Hope ecosystem, a new business venture aimed at exploring innovation in decentralized finance.

Babel Finance’s valuation hit US$2 billion just last year, but it reportedly incurred massive losses of about US$766 million while using customer funds for trading, Bloomberg reported.

See also: Hodlnaut assets hit by FTX debacle

Babel Finance’s latest move mirrors that of Hodlnaut, the Singapore-based exchange that lost almost US$190 million when TerraUSD collapsed.

In August 2022, Hodlnaut filed with local court to be placed under judicial management. The Singapore police force’s white-collar crime division started a probe into the company started later that year in November.

Other crypto companies in Singapore that have taken drastic measures to restructure include lender Vauld and trading platform Zipmex.