Continuing Withdrawal Trend, Another Crypto Lender Voyager Digital Halts Withdrawals, Deposits

This Friday, Voyager Digital, a crypto lender, announced that it had halted withdrawals, deposits, and trading on its platform. The crypto platform said it is exploring strategic alternatives for preserving the value of its platform.

The latest move is followed by the company issuing a default notice to challenge Three Arrows Capital (3AC), a crypto hedge fund, in relation to the fund’s inability to compensate for a loan.

Stephen Ehrlich, Chief Executive at Voyager, in a statement, said that the move leaves the company with enough time to explore strategic alternatives with several potential clients at the same time preserving the platform’s value.

In a release, Voyager shared about the hiring of the Conselho Group and Moelis & Company as financial advisors, while Kirkland & Ellis LLP as legal advisors for assisting them in the exploration of strategic alternatives.

Meanwhile, for a revolving line of credit, Voyager signed an agreement with Alameda Ventures Ltd on June 22. Its main aim is to gain access to additional capital so that it can fulfill the liquidity needs of its customers amidst the declining cryptocurrency prices.

Voyager further states in a release that it holds cryptocurrencies worth $685 million while it has loaned crypto assets worth over $1.12 billion.

New Jersey-based Voyager also revealed that it had loaned 15,250 bitcoins and $350 million to 3AC. Meanwhile, as per the reports of Reuters on Wednesday, a source revealed Three Arrows Capital (3AC) has entered into liquidation.

The announcement regarding the halting of withdrawals came less than a month after Celsius network, a rival crypto lender, citing “extreme market conditions,” also stopped withdrawals. The Celsius users are still waiting for withdrawals to reopen soon.

The collapse of Terra in early May resulted in USD and LUNA losing all their value, triggering the majority of the problems lurking in the crypto industry today. The bearish trend in the market is also among its negative consequences.

Flagship currencies, Bitcoin and Ethereum, also have suffered its wrath, with the leading cryptocurrency down by 58% in the first half of 2022. As of this writing, Bitcoin was trading at $19,432.21, up 1.89% in the past 24 hours.

Andrew is a blockchain developer who developed his interest in cryptocurrencies while his post-graduation. He is a keen observer of details and shares his passion for writing along with being a developer. His backend knowledge about blockchain helps him give a unique perspective to his writing