The official report by Babylon Finance states: “Despite our efforts, we haven’t been able to revert the negative momentum caused by the Rari/FEI hack. We don’t even have funds to keep the website and protocol running beyond November.”
Babylon Finance will shut down its services by November 15 after failing to recover from the Rari hack.
Rari Capital was hacked earlier this year, causing a loss of over $80M in crypto assets. Many of these crypto assets belonged to other DeFi projects, with Babylon Finance being one of them. Babylon reported losing $3.4M in the aftermath of the hack.
The situation for the Babylon team worsened when Rari Capital canceled its reimbursement to users in June. This created a point of no return for Babylon Protocol as users withdrew over 75% of their assets within the following days, thus reducing Babylon’s TVL to $5M and crashing the price of the BABL token from $20 to $5.
Unable to recover from the fallout of the Rari hack, Babylon Finance will shut down its services after November 15, with the distribution of treasury holdings to BABL and hBABL holders starting September 6.
Following the announcement, the value of the BABL token plummeted by over 90%. $BABL has since recovered by 19% and is currently priced at $0.4033.
The report by Ramon Recuero, Babylon Finance’s founder, revealed that the firm would return all vested and unvested tokens and provide restitution to all users once the FEI reimbursement is completed. Moreover, Babylon will extract all liquidity from the Uniswap tool to “prevent people from raiding the remaining liquidity.”
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