Voyager Digital freezes trading, deposits, withdrawals and rewards, blames 3AC default

The cryptocurrency exchange filed a notice of default to Singapore-based Three Arrows Capital earlier in the week, but promised it would continue operations.

Cryptocurrency exchange Voyager Digital announced Friday that it was temporarily suspending trading, deposits, withdrawals and loyalty rewards. “The failure of a borrower, Three Arrows Capital, to repay a substantial loan from us makes this the right path forward,” Voyager Digital CEO Stephen Ehrlich said on Twitter soon after the service suspension went into effect. 

“This decision, while far from optimal, will give us time to work to strengthen our balance sheet, a necessary condition to protect assets and preserve the future of the Voyager platform we have built together,” Ehrlich continued. A statement issued by the company said it has engaged Moelis & Co. and the Consello Group as financial advisers, and Kirkland & Ellis as legal advisers.

Voyagers, today we made the difficult decision to temporarily suspend trading, deposits, withdrawals, and loyalty rewards. Read more at:

— Stephen Ehrlich (@Ehrls15) July 1, 2022

Voyager Digital issued a notice of default to Three Arrows Capital, also known as 3AC, on Wednesday after the Singaporean crypto hedge fund failed to repay a 15,250 Bitcoin (BTC) and 350 million USD Coin (USDC) loan. Voyager gave assurances at the time that it would continue operations. The exchange explained that it had accessed $75 million of a revolving loan of 15,000 BTC it had taken out from Alameda Research to cover its exposure to the loans 3AC was unable to repay. It also said it had $137 million in cash and crypto on hand.

Related: Singapore reprimands 3AC for providing false information

A court in the British Virgin Islands reportedly ordered the liquidation of 3AC shortly after Voyager Digital filed its notice of default. Reports emerged June 16 that 3AC had failed to meet margin calls that week.

Voyager Digital did not indicate when it would restore trading, deposit, withdrawal and loyalty reward services. Its announcement came in the afternoon before a long weekend in the United States. Monday is U.S. Independence Day, which is a federal holiday.

Related Posts

1inch plugs into KuCoin Wallet to improve token swaps

1inch Network expands to another cryptocurrency exchange as KuCoin Wallet integrates its automated market maker functionality to improve token swaps. Cryptocurrency exchange KuCoin will introduce native token…

Interlay launches trustless BTC stablecoin bridge on Polkadot

InterBTC operates as a BTC-backed stablecoin, secured by a decentralized network of overcollateralized vaults, which according to Interlay, resembles MakerDAO’s DAI token. Interlay, a London-based blockchain firm,…

Philippine Central Bank Halts Bitcoin, Crypto Service Provider Approvals For Three Years

The central bank stated virtual asset service providers pose a great risk but will allow existing businesses to continue operations or expand. The central bank of the…

Why $10 Trillion AUM BlackRock Launched Spot Bitcoin Private Trust For Clients

Investment and financial services firm BlackRock will launch a spot Bitcoin private trust in the United States, according to an official post. The investment product was created…

Automobili Lamborghini’s Third NFT Drop is Here – “The Epic Road Trip”

Automobili Lamborghini is continuing its journey into Web3. The iconic brand is taking loyalists off-road and on a virtual mission that starts from the Moon, crosses space,…

BlackRock Makes Crypto Splash With Private Bitcoin Investment Trust Product

BlackRock has followed up its Coinbase partnership with its first institutional crypto investment product: a private bitcoin trust that offers direct exposure to spot BTC price action….

Generated by Feedzy