Crypto trading firm Auros Global has reached a resolution to restructure its distressed debt on blockchain-based lending protocol Maple Finance, its primary creditor, M11 Credit, announced on Wednesday. The firm had accrued some $18 million in unpaid loans as of Dec. 20, due to liquidity problems caused by frozen funds on FTX.
Auros entered into provisional liquidation in December, granted by a British Virgin Islands court. M11 Credit said Auros has already repaid 55% of the outstanding debt to the lending pools. The remaining debt was reissued for a maximum of nine months at 8.64% annualized interest in three cycles of 90 days, with the rest of the debt renewed at zero interest with a 90-day maturity.
The resolution of Auros’ debt restructuring is a relief for crypto credit markets after a turbulent year. The collapse of high-profile crypto firms such as Celsius Network, Three Arrows Capital and FTX resulted in a widespread liquidity crisis, leading to loan defaults and insolvencies. M11 Credit is still in the process of recovering $36 million of outstanding debt on Maple from Orthogonal Finance, a crypto trading firm that allegedly misrepresented its financials after FTX collapsed.
Liquidity providers of the affected lending pools should expect full recovery of their funds, M11 Credit said. The resolution of Auros’ debt restructuring is a positive sign for the crypto credit markets, and a reminder of the importance of due diligence when investing in crypto-related projects.