Maple Finance severs ties with Orthogonal Trading over insolvency concerns
Maple Finance, an institutional cryptocurrency lending protocol, has moved to terminate all business dealings with Orthogonal Trading over concerns that it is “virtually insolvent”.
Maple Financial Lending Partner Orthogonal trading Caught in the FTX collapse, the trading firm is in a liquidity crisis.
The trading company had four active loans in Maple’s M11 credit pool totaling $31 million and was due to be repaid on December 4th. However, he could not reveal that he could not repay the M11 pool due to his FTX exposure.
According to Maple, Orthogonal Trading had misrepresented its financial situation to the M11 pool over the past four weeks, only giving notice of insolvency about 24 hours before loan default.
Following Orthogonal Trading’s perceived fraud and inability to continue trading business without additional funding, Maple announced Cut all ties with the orthogonal group.
The statement read:
“Maple does not work with ill-wishers or companies that misrepresent their finances or business operations. We are shocked and disappointed by the actions of others, but this represents how we do business. It’s nothing.”
Orthogonal credit to pay off a $31 million loan
Orthogonal Trading was a borrower of the lending platform, while its parent company, Orthogonal Credit, was a pool delegate that contributed up to $850 million to Maple’s lending book.
Maple also said it would cut business ties with the Orthogonal Credit team after the trading company defaulted on its loans.
Maple added that Orthogonal Trading’s $31 million loan default will be billed from Orthogonal’s credit lending pool.
