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Crypto lender Maple Finance recently warns of insufficient cash” amid market turmoil
Maple Finance warned lenders about insufficient cash in pools in an updated note on Tuesday The news comes as Orthogonal Trading admits it is making a $10 million loan to Babel Finance from the Orthogonal USD Coin Pool on Maple Maple Finance is the latest in the crypto lending space to face liquidity pressure, the crypto lending platform said on Tuesday. “There may be cases where there is not enough cash in the pools,” the company wrote in a note updated Tuesday. Maple Finance lenders will have to wait for borrowers' repayments, the company said. "If …
Crypto lender Maple Finance recently warns of insufficient cash” amid market turmoil
- Maple Finance warnte die Kreditgeber in einer aktualisierten Mitteilung am Dienstag vor unzureichendem Bargeld in den Pools
- Die Nachricht kommt, als Orthogonal Trading zugibt, dass es ein Darlehen von 10 Millionen Dollar an Babel Finance vom Orthogonal USD gibt Coin Pool auf Ahorn
Maple Finance is the latest in the crypto lending space to face liquidity pressures, the crypto lending platform said on Tuesday.
“There may be instances where there is not enough cash in the pools,” the company wrote in a Notice Updated Tuesday.
Maple Finance lenders will have to wait for borrowers' repayments, the company said.
“As the loans mature in the coming weeks, the borrower’s repayments will increase the available capital in the pools, which can then be withdrawn by lenders,” the statement said. “Lenders will continue to earn interest and MPL [Maple token] rewards during this time.”
Delegates managing liquidity pools on Maple plan to service all withdrawals in the “coming weeks,” similar to how the lender handled withdrawals around the time of Terra USD’s collapse in May, a Maple Finance spokesperson said.
“Due to the protocol, cash can only be withdrawn when it is available – we have not frozen withdrawals,” the spokesperson said. "Cash continues to flow in from deposits and redemptions, so should balance out in the near future. [We] felt it was important to share the news with protocol participants in advance."
Maple Finance's loan pools and activities are publicly available, the company said Notice. As things stand, Maple Finance has lent more than it has lent. The company Reports just over $1.5 billion in loans and about $929 million in deposits.
The news comes as investors continue to speculate about the future of Babel Finance after the crypto lender disclosed liquidity pressures and halted withdrawals following the collapse of others in the space, including Celsius and Three Arrows Capital.
Orthogonal Trading, a cryptocurrency hedge fund, has recognized that there is a $10 million loan from Orthogonal USD to Babel Finance Coin Pool on Maple.
“Orthogonal has been in daily contact with Babel management since Babel suspended payouts and is focused on protecting the interests of lenders,” Maple Finance said in a Tweet Tuesday.
Maple's warning comes as members of the cryptocurrency industry fret over potential contagion risks that will only increase as liquidity pressures continue and lenders try to avoid runs.
“There is no easy solution, but more robust liquidity is a good starting point for crypto institutions under stress,” said Timo Lehes, co-founder of blockchain infrastructure company Swarms. “The US Federal Reserve is conducting its latest bank stress test later this week, which is a timely reminder that this liquidity can only really be organized with some kind of supervision.”
The situation highlights the need for greater regulatory oversight of the industry, Lehes added.
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The post Crypto Lender Maple Finance Latest Warns of “Insufficient Cash” Amid Market Turmoil is not financial advice.