High Court rejects US$5m claim against Babel Finance co-founder over crypto fund collapse

The High Court found that Babel Finance co-founder Wang Li did not dishonestly assist in any breach of duty owed to investor Parastate Labs.

ST PHOTO: SHINTARO TAY

Published Sep 03, 2026, 12:00 PM

Updated Sep 03, 2026, 12:00 PM

The High Court dismissed a US$5 million claim against Babel Finance co-founder Wang Li, finding no dishonest assistance or fiduciary breach in the collapse of Babel's crypto fund.

Babel's accounts on Deribit were liquidated amid market turmoil in June 2022, wiping out Parastate Labs' investment, despite Wang's efforts to prevent liquidation and negotiate with the exchange.

The court ruled Parastate was a sophisticated investor who had no trust or fiduciary rights over its investment, and found no misleading statements or personal benefit by Wang in the collapse.

SINGAPORE – An investor failed in its bid to recover US$5 million from the co-founder of collapsed cryptocurrency company Babel Finance after its investment was wiped out during a mass liquidation of the company’s trading accounts in 2022.

The High Court on Sept 1 found that co-founder Wang Li, who was responsible for Babel Finance’s trading strategies, did not dishonestly assist in any breach of duty owed to investor Parastate Labs.

Justice Sushil Nair, who will become Singapore’s fifth Chief Justice in February 2027, also rejected Parastate’s argument that its investment was held on trust for it, or that the company managing its money owed it fiduciary duties.

He said in a 139-page judgment that the evidence showed Wang had in fact tried to prevent the liquidation of Babel’s accounts on the Deribit cryptocurrency exchange.

The judgment arose from the collapse of Babel Group, which was insolvent by June 2022, with a shortfall of about US$400 million. Babel Finance is the brand name of the group’s cryptocurrency business.

Parastate, a United States-incorporated cryptocurrency investor, had put five million USDT – a cryptocurrency designed to track the value of the US dollar – into one of Babel’s funds in March 2022.

The investment was subject to a three-month lock-up period, with Parastate promising a return of at least 8 per cent.

Both companies agreed that the investment agreement would be governed by Singapore law and that the money would be held in a designated sub-account on Deribit, a cryptocurrency derivatives exchange.

But by June 2022, the cryptocurrency market was in turmoil and Babel was facing serious liquidity problems.

On June 14, Deribit began demanding that Babel top up three of its accounts as their values fell. The exchange said Babel needed to deposit 200 Bitcoin and 2,000 Ether every hour to cover the shortfall.

Babel deposited 200 Bitcoin, but Deribit began liquidating its positions less than an hour later.

Wang complained that the move was “a big hurt”, saying Babel had been one of Deribit’s largest clients for three years.

He also tried to negotiate with the exchange. Among other things, he proposed that Deribit liquidate only one of Babel’s accounts and return the others to Babel’s control, after which the company would make the necessary top-ups within 48 hours.

But Deribit eventually consolidated Babel’s various accounts into a main account before liquidating the trading positions.

The result was a deficit of about US$12.5 million across Babel’s accounts with Deribit.

“This meant that the Babel Group’s customers’ investments, insofar as they were held by the Babel Group… with Deribit, were completely wiped out,” Nair said.

Babel informed its customers on June 17 that the cryptocurrency market had “seen major fluctuations” and that it was “facing unusual liquidity pressures”. It said it would suspend redemptions and withdrawals of all its financial products for an unspecified period.

Parastate discovered that its investment was gone when it tried to withdraw its money on June 19.

It formally demanded the return of the five million USDT the next day.

Wang then told Parastate representative Chen Jiayi that Deribit had liquidated the main account and all its sub-accounts.

Wang said Deribit would not normally have automatically liquidated the accounts because Babel was its “biggest client” and had “rights of non-automatic liquidation”.

He said Deribit had contacted Babel when cryptocurrency prices fell and demanded that it top up its accounts within an hour, but began liquidating them after about 45 minutes.

The sub-account containing Parastate’s investment was “definitely without problem” at that point, Wang said.

Parastate subsequently sued Wang, alleging that he had dishonestly assisted breaches of trust and fiduciary duties by Babel entities.

It argued that Babel held its investment on trust and had breached its duties by failing to intervene when Deribit was consolidating the accounts. Wang’s failure to respond to Deribit’s messages was also said to amount to assistance in the alleged breaches.

Nair rejected the arguments.

He found no evidence that the Babel unit managing Parastate’s money had used the investment as collateral for its own trading. Doing so would have breached its duty to Parastate.

More fundamentally, he found that the company did not owe Parastate fiduciary duties. Such an obligation would have required Babel to put Parastate’s interests ahead of its own.

Parastate had pointed to language in the agreement stating that Babel would manage its assets “on behalf of and for the benefit of” Parastate. It also relied on the words, “We have your best interest in mind”, which appeared on the agreement.

But the judge said the slogan had been widely used by Babel across its businesses.

“To say that this slogan should be elevated to a fiduciary undertaking to act in the sole interests of Parastate was, with respect, a hopeless argument,” he said.

Nair noted that Parastate was a “seasoned cryptocurrency investor” and an institutional investor. Chen, who made investment decisions for Parastate, had about seven to eight years of experience in the cryptocurrency industry.

Parastate had also engaged external lawyers to review its contracts before entering into the investment agreement.

“Parastate’s decision to enter into the (agreement) was therefore a considered commercial decision made with the benefit of legal advice,” the judge said.

He also rejected the argument that Wang had benefited from the liquidation of Babel’s accounts.

The cross-liquidation had caused “great loss” to the Babel Group and had “catastrophic effects” on its asset-management business, he said.

For Wang personally, the collapse of Babel caused the value of his stake in its entities to become “virtually worthless”.

The judge also rejected Parastate’s allegation that Wang had acted dishonestly.

Wang had taken various steps to prevent the accounts from being consolidated and liquidated and had “in fact attempted – albeit unsuccessfully – to protect the Babel Group’s customers’ interests (including Parastate’s)”, Nair said.

Parastate had also argued that Babel made misleading statements about its financial strength when soliciting investments.

The judge found that Babel had represented that it had a “healthy balance sheet”, but rejected Parastate’s argument that it could reasonably have understood this to mean that Babel literally had US$7 billion worth of cryptocurrency on its balance sheet.

“To say that they had objectively understood the Babel Group as having US$7 billion of cryptocurrencies across its balance sheet therefore cuts no ice in the face of what was obviously a hyperbolic sales puff,” he said.

He noted that Parastate and Chen were sophisticated cryptocurrency investors and knew that Babel had been valued at US$2 billion in a fund-raising round in May 2022.

Nair dismissed Parastate’s claim in its entirety.

Parastate was represented by FC Legal Asia, while Wang was represented by RCLT Law Corporation.

Toh Yong Chuan is The Straits Times’ assistant business editor, covering manpower, political and policy issues, and law. He is an advocate and solicitor of the Supreme Court.

高等法院认定，Babel Finance 联合创始人王力并未以不诚实的方式协助违反对投资者 Parastate Labs 应尽的义务。

照片：郑信太郎

发布于 2026 年 9 月 3 日 下午 12:00

更新于2026年9月3日中午12:00

高等法院驳回了针对 Babel Finance 联合创始人王力的 500 万美元索赔，认为 Babel 加密基金的崩溃中不存在不诚实协助或违反信托义务的行为。

2022 年 6 月，由于市场动荡，Babel 在 Deribit 上的账户被清算，尽管王先生努力阻止清算并与交易所进行谈判，但 Parastate Labs 的投资还是化为乌有。

法院裁定 Parastate 是一家成熟的投资者，对其投资不享有信托或受托权利，并且没有发现王某在公司倒闭中作出误导性陈述或获得个人利益。

新加坡——一名投资者试图从倒闭的加密货币公司 Babel Finance 的联合创始人那里追回 500 万美元，但未能成功。此前，该公司在 2022 年对其交易账户进行大规模清算时，该投资者的投资被全部清零。

高等法院于 9 月 1 日裁定，负责 Babel Finance 交易策略的联合创始人王力并未以不诚实的方式协助违反对投资者 Parastate Labs 应尽的义务。

将于 2027 年 2 月成为新加坡第五任首席大法官的苏希尔·奈尔法官也驳回了 Parastate 的论点，即其投资是受托持有的，或者管理其资金的公司对其负有信托义务。

他在一份长达 139 页的判决书中表示，证据表明王某实际上曾试图阻止 Babel 在 Deribit 加密货币交易所的账户被清算。

该判决源于 Babel Group 的倒闭，该公司于 2022 年 6 月破产，负债约 4 亿美元。Babel Finance 是该集团加密货币业务的品牌名称。

Parastate 是一家在美国注册成立的加密货币投资者，于 2022 年 3 月向 Babel 的一只基金投入了 500 万 USDT（一种旨在追踪美元价值的加密货币）。

该投资需经过三个月的锁定期，Parastate 承诺至少 8% 的回报。

两家公司一致同意，该投资协议将受新加坡法律管辖，资金将存放在加密货币衍生品交易所 Deribit 的指定子账户中。

但到了 2022 年 6 月，加密货币市场陷入动荡，Babel 面临严重的流动性问题。

6月14日，由于Deribit交易所的三个账户价值下跌，Deribit开始要求Babel为其充值。该交易所称，Babel需要每小时存入200个比特币和2000个以太坊来弥补资金缺口。

Babel 存入了 200 个比特币，但不到一个小时后，Deribit 就开始清算其仓位。

王先生抱怨说，这一举动“非常伤人”，并表示 Babel 三年来一直是 Deribit 最大的客户之一。

他还尝试与交易所进行谈判。他提出的方案之一是，Deribit 只清算 Babel 的一个账户，并将其他账户归还给 Babel，之后 Deribit 将在 48 小时内完成必要的充值。

但德里比特最终将巴别塔的各个账户合并到一个主账户中，然后清算了交易头寸。

结果是 Babel 在 Deribit 的账户出现了约 1250 万美元的亏损。

“这意味着，巴别集团客户通过 Deribit 持有的投资全部化为乌有，”奈尔说。

6月17日，Babel通知其客户，加密货币市场“出现大幅波动”，并表示“面临异常流动性压力”。该公司称，将暂停所有金融产品的赎回和提款，具体暂停时间待定。

Parastate 在 6 月 19 日试图提取资金时发现，它的投资已经全部消失了。

第二天，该公司正式要求归还500万USDT。

王随后告诉 Parastate 代表陈嘉义，Deribit 已清算了主账户及其所有子账户。

王先生表示，Deribit 通常不会自动清算这些账户，因为 Babel 是其“最大的客户”，拥有“非自动清算权”。

他说，加密货币价格下跌时，Deribit 联系了 Babel，要求其在一小时内充值账户，但大约 45 分钟后就开始清算这些账户。

王先生表示，当时包含 Parastate 投资的子账户“绝对没有问题”。

Parastate 随后起诉王某，指控他以不诚实的方式协助 Babel 实体违反信托和受托义务。

Babel辩称，其投资系受托管理，且在Deribit合并账目时未予干预，构成违约。此外，王某未回复Deribit的信息也被视为协助其违反上述规定。

奈尔驳斥了这些论点。

他没有发现任何证据表明管理Parastate资金的Babel部门曾将该投资用作自身交易的抵押品。如果这样做，就违反了其对Parastate的义务。

更根本的是，他发现该公司对Parastate不负有信托义务。这种义务意味着Babel必须将Parastate的利益置于自身利益之上。

Parastate公司指出，协议中有一项条款规定，Babel公司将“代表Parastate公司并为Parastate公司的利益”管理其资产。该公司还援引了协议中“我们始终以您的最佳利益为出发点”的措辞。

但法官表示，巴别塔公司在其所有业务中都广泛使用了这一口号。

“说这个口号应该被​​提升到受托责任的程度，以完全维护 Parastate 的利益，恕我直言，这是一个毫无希望的论点，”他说。

奈尔指出，Parastate是一家“经验丰富的加密货币投资者”和机构投资者。为Parastate做出投资决策的陈先生在加密货币行业拥有大约七到八年的经验。

在签订投资协议之前，Parastate 还聘请了外部律师审查其合同。

法官表示：“因此，Parastate 决定签订（协议）是一项经过深思熟虑的商业决定，并且是在法律咨询的帮助下做出的。”

他还驳斥了王某从巴别尔账户清算中获益的说法。

他表示，交叉清算给巴别集团造成了“巨大损失”，并对其资产管理业务产生了“灾难性影响”。

对王先生个人而言，Babel 的倒闭导致他持有的股份价值“几乎一文不值”。

法官还驳回了 Parastate 关于王某行为不诚实的指控。

奈尔表示，王某采取了各种措施来阻止账户合并和清算，并且“实际上曾试图——尽管没有成功——保护巴别塔集团客户的利益（包括Parastate的利益）。”

Parastate 还辩称，Babel 在招揽投资时对其财务实力作出了误导性陈述。

法官认为 Babel 声称其资产负债表“健康”，但驳回了 Parastate 的论点，即 Parastate 完全可以合理地理解为 Babel 的资产负债表上确实有价值 70 亿美元的加密货币。

他说：“因此，说他们客观地了解到巴别集团的资产负债表上拥有价值 70 亿美元的加密货币，这显然是对销售人员夸大其词的吹嘘，根本站不住脚。”

他指出，Parastate 和 Chen 都是经验丰富的加密货币投资者，他们知道 Babel 在 2022 年 5 月的一轮融资中估值达到了 20 亿美元。

奈尔完全驳回了 Parastate 的诉讼请求。

Parastate 的代理律师是 FC Legal Asia，而 Wang 的代理律师是 RCLT Law Corporation。

杜永泉是《海峡时报》的助理商业编辑，负责报道人力资源、政治政策和法律方面的新闻。他同时也是最高法院的律师。