Babel Finance, one of the many cryptocurrency lending firms that suffered losses during the cryptocurrency winter of 2022, is exploring new restructuring opportunities to pay off its creditors. The Hong Kong-based company has announced plans to build a new decentralized finance (DeFi) project called Hope, which aims to generate revenue to pay off the company’s debts.

Hope will reportedly mint a new stablecoin that will be used as a “recovery coin” for Babel. Unlike major stablecoins like Tether (USDT) and USD Coin (USDC), Hope’s eponymous stablecoin will reportedly use Bitcoin (BTC) and Ether (ETH) as collateral, maintaining its 1:1 ratio to the dollar. through arbitrage incentives for merchants.

Babel co-founder Yang Zhou is leading the restructuring efforts and has accused another co-founder, Wang Li, of being responsible for the company’s losses. The company estimates that it owes clients up to $524 million worth of BTC, ETH and other cryptocurrencies due to losses allegedly caused by Wang’s risky trading activities. Another $224 million was reportedly lost when Babel’s counterparties liquidated the guarantee after the company was unable to meet a large volume of margin calls.

Babel’s liquidity problems are not unique, as several prominent lenders in the industry face similar challenges. Voyager Digital, Celsius Network, Genesis Global, and Hodlnaut are among those that have experienced serious liquidity problems due to the cryptocurrency winter of 2022. Genesis owes $150 million to Babel, its third-largest creditor, according to a Chapter 11 filing. from January.

In late February, Voyager clients voted in favor of a restructuring plan that included Binance’s US business, Binance.US, acquiring Voyager’s assets. Babel’s restructuring plans involve Hope, which will generate income to pay off the company’s debts. Yang Zhou hopes this project will help save the company and restore its reputation in the cryptocurrency lending space.