Why is this transaction important to the global crypto market?
This two-year transaction demonstrates that crypto can be a long term play and that the crypto ecosystem is becoming mature. There is a rising market demand for long-end liquidity, indicating a healthy market structure and growing participant trust.
Transactions lasting 2-years are rare in the cryptocurrency institution market. “Until 2022, we have barely seen liquidity transactions of over 3 months in the crypto market. This might be the first”, said Babel Finance’s Head of Treasury, Song Yang.
Currently, there is a scarcity of detailed data on the bitcoin lending/borrowing sector. However, according to preliminary estimates, the crypto lending/borrowing market size, which includes CeFi and Defi, is approaching US$8.2 billion (reference: Top Lending/Borrowing Coins by Market Capitalization – CoinGecko). Active parties such as Genesis Capital, Celsius, B2C2, Nexo, Babel Finance, and others rarely provide long-term liquidity.
‘This ETH lending shows an increasing long term market demand for ETH, from the developments of DeFi, NFTs and new projects’, said Song Yang.
As evidenced by Babel Finance’s crypto 2-year swap, further long-term crypto investments and trading are achievable. Long-term crypto investors can earn interest on their Bitcoin by engaging in extra DeFi activities like lending and staking. This is something that Babel Finance’s crypto trading arm will be looking into. In the future, the Babel Finance Hong Kong team may, with agreement by their clients, to have their cryptocurrency held in the ecosystem and used to validate transactions in exchange for interest. Furthermore, there’s always the possibility that the value of their crypto assets may grow and result in a long-term profit.
Babel Finance, one of the world’s leading crypto traders with over 500 institutional clients globally, has shown that crypto finance, Defi, and crypto-based assets will become mainstream in financial markets with institutional and private investors through this deal.
- Transaction: Market to Market Cross Cryptocurrency Swap (MtM CCS)
- Currency: BTC and ETH
- Amount: US$ 50M
About Babel Finance
Babel Finance is a global leading crypto financial services provider, offering institutional and HNWI investors professional services covering crypto lending and crypto trading.
The company is backed by prominent investors including Sequoia Capital China, Tiger Global Management, BAI Capital, Zoo Capital, Dragonfly Capital, and NGC Ventures.
With a business focus in Asia and a business headquarters in Singapore, Babel Finance has established close cooperative relationships with major global exchanges, custodians, investment funds, and mining institutions.
The issuer is solely responsible for the content of this announcement.