After leaving his position as CEO of Babel Finance, creator Flex Yang has developed the HOPE stablecoin and the associated DeFi network. The ecosystem intends to bridge the gap between centralized finance, traditional finance, and DeFi apps by providing financial services to customers using smart contracts rather than middlemen.
The dollar-backed HOPE stablecoin will utilize its first funding to amass bitcoin and ether reserves, then use those assets to establish a price floor and ceiling. Users will eventually be able to purchase the HOPE token to interact with the ecosystem’s DeFi apps. The governance of the stablecoin will eventually be given up to a decentralized autonomous organization.
HopeSwap will be the first app on the platform, serving as an on-ramp for users to purchase HOPE on the platform. Eventually, HopeConnect will open and provide derivatives trading apps, as well as self-custody security using DeFi smart contracts.
HopeLend, a non-custodial lending platform, HopeEcho, which produces synthetic assets that reflect the values of real-world assets, and third-party DeFi apps created on the HOPE ecosystem are among the other anticipated applications.
Legal Tensions
Babel Finance, the former company of Yang, is planning to file a moratorium of protection to the high court of Singapore, according to a Bloomberg report. The filing alleges that Babel Finance co-founder, Wang Li, was responsible for the losses suffered by the company. It was reported that the crypto lender lost $280 million in customer funds due to risky trading activities.
Babel Finance halted withdrawals in June 2022 following similar action by Celsius. The HOPE stablecoin will be Bitcoin and Ethereum-backed and will use these two as collateral to maintain a dollar peg while offering arbitrage opportunities for participants. HOPE will trade at either a premium or discount to its tracking price, depending on market demand. The website stated that LightDAO would hold the crypto reserves on-chain.
Babel Finance is among several crypto lenders that suffered from the 2022 bear market. Voyager Digital, Celsius Network, and Genesis Global have all filed for bankruptcy with Genesis owing $150 million to Babel. Investors in Babel Finance at the time of its $80 million funding round included Jeneration Capital and DragonFly Capital.
