Withdrawals have been halted by a Hong Kong-based crypto-lender due to the market’s widespread decline.
In a post on its website, Babel Finance stated that company is experiencing “strange liquidity.”
‘We are in constant communication with all relevant parties regarding the activities we are taking to best safeguard our clients,’ they stated.
‘Redeemations and withdrawals from Babel Finance products will be temporarily halted at this time, and the resumption of regular service will be announced subsequently.’
‘We truly regret for any trouble this has caused.’
After prominent U.S. bitcoin lending business Celsius Network banned withdrawals and transfers on June 12 claiming “extreme” conditions, they are the third large lender to do so in recent days.
Customers who deposit cryptocurrencies on Celsius’s platform may get interest-bearing goods, which they can subsequently lend out for a profit.
The business stated in a blog post that withdrawals and transfers between accounts had been blocked ‘to maintain liquidity and operations while we take efforts to preserve and protect assets.’
‘We are taking this step now to put Celsius in a better position to meet its withdrawal commitments over time,’ stated the New Jersey-based firm.
It’s the latest example of global financial crisis leaking over into the crypto markets, causing volatility.
Bitcoin was the first digital currency, launched in 2009 to circumvent central banks, and a growing number of branch currencies, as well as digital art known as non-fungible tokens, have emerged in recent years.
In recent weeks, the value of crypto has plummeted, with one currency losing 98 percent of its value as anxieties about the global economy spread and investors begin to dump riskier assets.
On Monday, the value of cryptocurrency fell below $1 trillion for the first time since January 2021, driven down by an 11 percent slump in Bitcoin.
Binance, the world’s largest cryptocurrency exchange, halted withdrawals on Monday, citing a’stuck transaction’ that generated a trading backlog.
There are worries that the latest crypto meltdown has only just begun, with Bitcoin currently trading at $21,016.80, down from over $30,000 on May 31.