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Maple Finance Says Lenders May Have to Wait for Borrower Repayments

1 min
Updated by Geraint Price
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In Brief

  • Maple Finance posted an update on liquidity in pools.
  • It cited market conditions as potentially leading to insufficient funds in some pools.
  • Other platforms have experienced similar problems, as the market crash bites.
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Lending platform Maple Finance has become the latest firm to face liquidity problems.

The platform posted an update on its website in a post titled “Managing liquidity for lenders and borrowers,” saying: “There may be instances where there is insufficient cash in pools.”

Liquidity issues began this week, though Maple Finance says that as loans mature over the weeks to come, an increase in the available capital in the pools due to borrower repayments will allow lenders to go through with withdrawals. 

It also stated said lenders’ ability to earn interest and Maple token (MPL) rewards will not be affected.

Once all withdrawal requests are processed, pool delegates will begin to issue loans again. Orthogonal Trading, a cryptocurrency hedge fund, has acknowledged that there is a $10 million loan to Babel Finance from the Orthogonal USD Coin pool on Maple. 

Babel has halted withdrawals and released a debt repayment arrangement.

The crypto world has come under severe pressure with the recent market crash. Many platforms are facing liquidity pressures, pushing many to the brink of survival. Even mining companies are struggling, with Canadian firm Bitfarms selling 3000 BTC to improve liquidity.

Decentralized finance (DeFi) protocol Bancor has also suspended impermanent loss protection, citing hostile market conditions. This was one of the platform’s key features.

MakerDAO has paused DAI deposits, citing the same reason. And Three Arrows Capital is rumored to be facing insolvency.

It will take time and restrategizing for companies to recompose themselves and manage the market downturn without further damage. 

Such developments are part of the crypto market, though the great growth experienced in the past few years has certainly magnified the setbacks.

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Rahul Nambiampurath
Rahul Nambiampurath's cryptocurrency journey first began in 2014 when he stumbled upon Satoshi's Bitcoin whitepaper. With a bachelor's degree in Commerce and an MBA in Finance from Sikkim Manipal University, he was among the few that first recognized the sheer untapped potential of decentralized technologies. Since then, he has helped DeFi platforms like Balancer and Sidus Heroes — a web3 metaverse — as well as CEXs like Bitso (Mexico's biggest) and Overbit to reach new heights with his...