Key Takeaways
- Auros borrowed 2,000 wETH ($2.6 million) with a 14-day maturity on November 27, three days before M11 Credit’s statement on Auros’ short-term liquidity crunch.
- M11 Credit states its working with Auros to provide a joint statement that would provide further information to lenders.
Crypto trading firm Auros Global is the latest company in a growing list of firms to face liquidity scares owing to the FTX contagion. On Wednesday, Auros missed a principal payment on the 2,400 wETH loan, worth around $3 million, borrowed from the credit pool on Maple Finance, a Decentralised lending platform.
Auros borrowed 2,000 wETH ($2.6 million) with a 14-day maturity on November 27, three days before M11’s statement about Auros’ short-term liquidity crunch. This was revealed to the public by institutional credit underwriter M11 Credit, which manages liquidity pools on Maple Finance, in a Twitter thread.
“Auros is experiencing a short-term liquidity issue as a result of the FTX insolvency,” the tweet reads. M11 Credit further adds that it’s working with Auros to provide a joint statement that would provide further information to lenders.
M11 Credit stated that missed payment is not an indication the loan is in default. As per smart contracts, the missed payment has now triggered a 5-day grace period. Auros has until December 5 to make the late payment before it is declared as being in default.
Apart from Auros, several other firms in the crypto space have been affected negatively by FTX’s unprecedented collapse. For example, earlier this month, Galois Capital revealed that the fund lost almost 50% of its assets in the FTX collapse. Following FTX exposure, US crypto broker Genesis is currently working to avoid a bankruptcy filing. Genesis Trading had suspended customer redemptions in early November, citing the sudden collapse of FTX, where its derivatives business has around $175 million in locked funds.
In the past few months, there have now been increasing instances of decentralized lending protocols defaulting on their loans as digital asset trading firms continue to face liquidity crunches. Recently, South Korean blockchain investment firm Blockwater Technologies defaulted on a $3.4 million loan in Binance USD (BUSD) stablecoin from TrueFi, a decentralized lending protocol.
