As there seems to be no end in sight for crypto losses, the effects are being felt in many parts of the ecosystem. Many companies are looking at the risk of liquidation and have laid off many of their employees. They are also pausing user activity on platforms to stay financially viable.
The latest stoppage is by Babel Finance, and this was done by serving a public notice to users on June 17th. According to the notice, fluctuations in the crypto market have resulted in the company facing liquidity pressure. The company also stated that it is staying connected with customers to ensure that they are protected. It has suspended the withdrawal and redemption facility for its products till further notice. The company sought to reassure its users that service would resume but did not mention a firm date.
One user said that Babel is still afloat, but liquidation is being considered. Babel Finance raised about $80 million in a new round of investments last month, May 2022. Its current valuation stands at $2 billion. Investors included Circle Ventures, Jeneration Capital and 10T holdings.
A number of crypto companies made the news headlines with their struggles to retain capital while valuations of various currencies drop steeply. Since the beginning of 2022, especially Q1, many cryptos have lost value drastically. Per recent news reports, a rival crypto platform Finblox also put out a notice about restricting users and limiting daily withdrawal amounts. Finblox is connected to Three Arrow Capital.