Singapore Court Extends Babel Finance's Moratorium Period

Extension of Creditor Protection

The Singapore court has granted Babel Finance an extension of its creditor protection plan, now set to last until July 21, 2023. This decision follows the company's efforts to navigate its financial restructuring after facing significant liquidity challenges.

Liquidity Challenges and Initial Measures

In June 2022, Babel Finance encountered severe liquidity pressures, primarily due to the collapse of FTX. As a precaution, the company temporarily halted withdrawals, aiming to safeguard consumer assets. This pause was part of an effort to stabilize operations and formulate a recovery strategy.

Strategic Restructuring Efforts

To address these challenges, Babel Finance submitted a moratorium application to the Singapore High Court. This extension allows Babel Finance additional time to deploy new strategies, including the introduction of "Babel Recovery Coins," a decentralized finance project aimed at restoring financial stability.

Court Approval and Creditor Objections

Despite initial objections from creditors like Deribit, a prominent crypto options exchange, the Singapore court has now approved the extension. The court had previously requested a detailed description of Babel Finance's restructuring plan to address these concerns.

Leadership and Future Plans

Flex Yang, the co-founder of Babel Finance, has recently returned to the company after a two-year absence to oversee the restructuring process. The plan focuses on settling approximately $800 million in company debts, marking a significant step toward financial recovery and stability.

Babel Finance continues to work towards resuming normal service operations and fulfilling its obligations to creditors, with this court-approved extension serving as a crucial component of this effort.