The decentralized finance (DeFi) protocol, Babylon Finance has finally announced that it will close after months of trying to recover from the negative momentum caused by the Rari Fuse exploit.
It’s a statement, its founder, Ramón Recuero, explained that the platform experienced an insurmountable losing streak despite the efforts of his team to withstand the domino effect caused by the hack. According to Recuero, the protocol lost USD 3.4 million in the hack. Behind this, the total value locked on the platform went from $30 million to $4 million. To make matters worse, the Fuse pool was abandoned.eliminating the loan market worth USD 10 million, Recuero pointed out.
The bearish sentiment situation in the cryptocurrency market in general also added insult to injury. The founder of the DeFi protocol said that as the troubles unfolded, Babylon Finance’s native crypto token BABL also went from $20 to $6, losing months of travel for the team.
Apart of this, the founder explained that financing options using BABL as collateral became impossible. On top of that, the option to raise funds using tokens was not feasible due to their low price. This has been stated on Twitter:
4/ For the last few months, the team has been working without a salary trying to find ways to get back on track with our previous TVL growth.
Based on our business model and fees, Babylon needed to reach 50M in TVL to become self-sustainable.
We couldn’t get there.
— Ramón Recuero | (@ramonrecuero) August 31, 2022
For the past few months, the team has been working without pay trying to find a way to get back on track with our previous TVL growth.
Based on our business model and rates, Babylon needed to reach 50M TVL to be self-sustaining.
We couldn’t get it.
The founder also said that as the final action of his core team, all remaining shares of your treasury will be distributed to BABL and hBABL holders from September 6th. The team also said that it will return all vested and non-vested tokens.
After the announcement, BABL price fell by 99%, reaching a new all-time low of $0.23 per token. At the time of writing, the coitza token is at $0.44.
In May, The attackers stole assets worth around $80 million from Rari Capital’s Fuse platform. During that time, the DeFi protocol offered a $10 million reward to the exploiters and asked them to return the stolen funds.
Clarification: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information set forth herein should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
Keep reading:
Investments in crypto assets are not regulated. They may not be suitable for retail investors and the full amount invested may be lost. The services or products offered are not aimed at or accessible to investors in Spain.