Canadian crypto dealer Voyager Digital (VYGVF) suspended buying and selling, deposits, withdrawals, and loyalty rewards, in keeping with a statement launched by the agency Friday afternoon.
The choice comes after the agency gave a notice of default to crypto hedge fund Three Arrows Capital (3AC) after it did not repay over $644 million in borrowed bitcoin (BTC-USD) and USDC.
“This was a tremendously troublesome choice, however we consider it’s the proper one given present market situations,” Voyager CEO Stephen Ehrlich mentioned within the launch, citing the pause as a method to pursue the funds owed by Three Arrows.
Moreover, the suspension means clients can not use their Voyager debit card. Excluding at the least $645 million in loaned belongings associated to 3AC, Voyager has an extra $480 million in excellent crypto belongings on mortgage as of Thursday.
Voyager has employed Moelis & Firm and The Consello Group as monetary advisors and Kirkland & Ellis LLP as a authorized advisor.
Shares of Voyager Digital, which commerce over-the-counter within the US, fell 30% on Friday. Canadian fairness markets have been closed on Friday. Shares of Voyager Digital have misplaced over 97% this yr.
Earlier this month, Voyager signed a term sheet with Sam Bankman-Fried’s buying and selling agency Alameda Analysis for a revolving credit score line of $200 million in money/USDC and 15,000 in BTC, a complete of $439 million primarily based on bitcoin’s present worth.
As of the time of this writing, Voyager had already accessed $75 million of this credit score line. The default discover from 3AC doesn’t break Voyager’s phrases with Alameda, in keeping with a launch from Voyager.
Along with Voyager, the listing of lenders owed cryptocurrency by Three Arrows has been mounting because the agency first conveyed monetary issues greater than two weeks in the past.
BlockFi, which on Friday afternoon announced it had struck a deal with crypto exchange FTX.US, has skilled $80 million in losses from its dealings with Three Arrows.
One other main crypto dealer, Genesis Buying and selling, can also be mitigating potential losses within the “a whole bunch of hundreds of thousands” in keeping with its sibling firm, Coindesk.
David Hollerith covers cryptocurrency for Yahoo Finance. Comply with him @dshollers.
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