DeFi asset management protocol Babylon Finance plans to shut down services on November 15th. publication By founder Ramon Recuello on August 31st.
1/ Babylon Finance is closed
Despite our efforts, we were unable to reverse the negative momentum caused by the Rari hack. 🐻 The market was useless.https://t.co/Qgb5XM33ZX
🧵 TLDR below
— Ramon Recuero | 🦇🔊 (@ramonrecuero) August 31, 2022
The announcement revealed that the protocol did not recover from the $80 million hack Rari/FEI. Recovery is difficult in the current market conditions.
Prior to the Rari/FEI hack, the protocol was in a relatively strong position, with the total amount locked reaching $30 million and creating a top 10 lending pool on Rari.
However, the Rari/FEI exploit cost investors $3.4 million and users withdrew 75% of their TVL (approximately $14 million) within two days.
The Rari/FEI has taken the decision to cancel the redemption plan and has been forced to change the price of the Rari assets to zero.
Another victim of the FEI debacle 👇
(Remember they had the power to return these funds and make the victims whole. They simply chose not to 😔). https://t.co/ypeI6A17hR
— Sam Kazemian (¤, ¤) (@samkazemian) August 31, 2022
Rari continued that Fuse’s $10 million lending market has been abandoned because its native token, BABL, can no longer be used as collateral to borrow funds.
“The team lost three months worth of runway invested in Rari as the money evaporated overnight, along with potential borrowing from BABL’s holdings.”
The BABL token also lost over 90% of its value during this period, plummeting from $20 to $5. According to the announcement, Crash has ruled out future fundraising efforts. Because, he said, “the supply of tokens is limited, not inflation, there is only 10% left in the Treasury.”
It was also revealed that the team has been working without pay since the Rari/FEI hack occurred.
“[The hack] Our cash position, access to funding, and most importantly, user confidence have been compromised. “
What’s next for Babylon Finance users?
The Babylon Finance team has revealed that from September 6th, all financial assets will be consolidated and distributed to BABL and hBABL holders.
Babylon Finance users must withdraw their funds by November 15th when the website shuts down.
Meanwhile, the protocol removed all available liquidity in the Uniswap v3 pool to prevent draining during the liquidation process.
$BABL price plummets
Babylon Finance’s BABL token has fallen more than 92% in the last 24 hours behind the announcement.
According to Coin Gecko dataThe value of the token dropped from over $5 to $0.218851.
OpenSea data also shows that Babylon Prophets, an NFT collection of wealth management protocols, has declined over the past three months.according to dataThe last sale of the collection took place on August 6th at Prophet #629 and sold for 0.008 ETH ($12).