Decentralized finance (DeFi) protocol Babylon Finance has recently announced that it would close down after spending months attempting to recover from an escalating issue caused by the Rari Fuse exploit.
Babylon Finance founder Ramon Recuero said that — despite his team’s efforts to withstand the ripple effects caused by the hack — the platform saw an irreversible negative streak.
Recuero claimed that the protocol faced a loss of $3.4 million. The platform’s overall value was then reduced from $30 million to $4 million. He added that the abandonment of the Fuse pool worsened the situation by eliminating a lending market worth $10 million.
Further exacerbation was caused by the bearish sentiment situation across the crypto market. The founder stated that, as the problems grew, the platform’s native token BABL also dropped in value from $20 to $6, costing the team months of development time.
Besides these, the founder explained that it was now impossible to obtain funding using BABL as collateral. Moreover, the possibility of fundraising through the tokens was impractical due to its price drop.
Recuero said that starting on September 6, all of their treasury’s remaining holdings will be transferred to BABL and hBABL holders as a final move from their core team. Additionally, the team announced it will return all tokens, vested and unvested.
Attackers plundered assets worth about $80 million in May from Rari Capital’s Fuse Platform. At the time, the DeFi protocol asked the exploiters to return the stolen funds in exchange for $10 million bounty reward.
