After TSX-listed Voyager Digital revealed it was owed $ 655 million by Three Arrows Capital (3AC), the company secured a $ 500 million line of credit from Alameda Ventures to “protect client assets.” Five days later on July 1, Voyager announced that the crypto company was “temporarily suspending trading, deposits, withdrawals and loyalty rewards.”
Another Crypto Company Freezes Withdrawals, Voyager CEO Says ‘It Was a Very Difficult Decision’
- The struggling digital currency company Voyager Digital (OTCMKTS: VYGVF) announced a temporary withdrawal and a deposit break on Friday, according to a recent statement press release. Voyager explained that it “temporarily suspends trading, deposits, withdrawals and loyalty rewards, effective at 2:00 pm Eastern Daylight Time today.”
- “This was a very difficult decision, but we believe it is the right one given the current market conditions,” said Stephen Ehrlich, Voyager’s chief executive in a statement.
- VYGVF shares disintegrated to $ 0.29 per share after the previous close at $ 0.44 per share on Thursday. Shares have lost 99% since the stock’s all-time high of $ 27.39 per share on April 1, 2021.
- “This decision gives us additional time to continue exploring strategic alternatives with various stakeholders while preserving the value of the Voyager platform we built together,” Ehrlich added. “We will provide additional information at the right time.”
- In addition to the update regarding deposits, withdrawals and loyalty compensation, Voyager summarized 3AC’s debt to the company. “Voyager also provided the following financial and balance sheets, in accordance with requirements of Canadian securities laws,” the company explained.
- Just last week, Voyager opened a line of credit with Alameda Ventures and said it had secured a revolving $ 500 million line of credit from the company. The announcement came after Voyager revealed it was owed $ 655 million in the form of bitcoin (BTC) and the stable coin usd currency (USDC).
- In addition, Voyager has also revealed that it is working with Kirkland & Ellis LLP for legal aid and Moelis & Company and The Consello Group for financial advice.
- Voyager’s withdrawal pause follows the suspension of withdrawals the crypto lender Celsius initiated weeks ago. Celsius has yet to update the community on the company’s official plans to resolve its financial difficulties.
- However, on Thursday, Celsius published a blog post that says the firm is “focused and working as quickly as possible to stabilize liquidity and operations.” Celsius further said it “deals with strategic transactions” and “restructures” liabilities, “among other ways.”
- On the same day Voyager temporarily froze the main operations of the exchange, Blockfi co-founder Zac Prince revealed that Blockfi lost about $ 80 million due to a discovery of 3AC and stressed that it is “a fraction of losses reported by others.”
- Voyager’s announcement also discussed “the judicially ordered liquidation process in the British Virgin Islands,” as the crypto company said it was “actively seeking all available resources for 3AC’s recovery.”
What do you think of Voyager Digital temporarily pausing withdrawals? Let us know what you think about this topic in the comment section below.
Image Credits: Shutterstock, Pixabay, WikiCommunity, Editorial Photo Credit: T. Schneider / Shutterstock.com
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or support of any products, services or companies. Bitcoin.com does not provide investment, tax, legal or accounting advice. Neither the company nor the author is liable, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use or reliance on any content, goods or services mentioned in this article.