The crypto winter has frozen a lot more than market movements. Now, people’s livelihoods are at stake. And just like Sam Bankman-Fried predicted, crypto lending platforms hang by the ropes to stay liquid.
Despite the FTX founder’s attempts to bail out Voyager, the situation has gotten worse. And just as the crypto gurus foresaw, Voyager has halted all the withdrawals and deposits.
We need time to explore our alternatives: Voyager Chief
The announcement to halt necessarily all the activities on the platform came on 1st July 2022, in which the Voyager Chief stated that his team had made a difficult but mandatory decision to temporarily suspend withdrawals, deposits, trading, and loyalty rewards.
“It will provide us time to continue to explore strategic alternatives and preserve the voyager platform we have built together. We are in discussions with various parties and will provide additional information at the appropriate time.” – Voyager Chief said in the official statement.
What the Voyager Users would still be able to do, and What They won’t be?
Thankfully, the announcement comes with additional information about what Voyager users can expect for the time being.
The Voyager Digital App is Still working
The app will continue to work, allowing users to view market data and their portfolios. Users will also receive reward payments in June and July.
The statement does not talk about anything beyond July.
When will the users be able to assess the assets on the platform?
The official statement gives no news about when or if the users can assess their assets on the platform. “We are working quickly to life the suspension on trading, deposits, withdrawals, and loyalty rewards.” – the statement reads.
The team has although promised to update the customer regularly as it arrives.
What about those with the Voyager Debit Card?
Voyager debit card is a crypto-powered debit card in the same vein as Crypto.com’s flagship product. It allows users to spend their USDC holdings like cash at outlets that accept Mastercard. The biggest draw of the card, however, has been its 9% annual reward.
But now that Voyager digital has suspended most operations, the Voyager Debit card will stop working. Users will neither receive rewards nor will be able to make any automatic payments using the debit card.
After realizing customers are likely to ask the meaning of the diplomatic term “exploring strategic alternatives,” Voyager Digital said it means that it’s in contact with parties to bring additional liquidity to the platform.
To sum up, users won’t be able to use the platform for trading, withdrawing, or depositing. However, Voyager digital has stated that users will receive the rewards for June and July. The statement did not answer whether or not users can withdraw these rewards.
Failure to Recover the Debt is the cause of Voyager’s Current State
Three Arrows Capital, the Singapore-based crypto hedge fund, finally fell into the pit of liquidation after repeatedly denying on social media that the situation wasn’t that bad.
Everyone from the founder to some insider sources attempted to assuage the community’s concerns that the company would find a way to bounce back. The concerning part of this is that despite seeing the downfall on crypto giants such as Celsius, the community held out hope.
And Three Arrow Capitals was also not ready to give up and tried to stay afloat, taking debts from left and right. But, oblivious about its own terrible state, the crypto hedge fund company ended up with $675 million in debt that it couldn’t possibly repay.
The fate of 3AC came to a disastrous conclusion on 2nd July 2022 when the British Virgin Islands court ordered the liquidation of the crypto hedge fund company – leading 3AC to file for Chapter 15 Bankruptcy.
Voyager’s current state is because of Three Arrow Capital’s inability to pay. Voyager was THE lender that lent $350 million and 15,250 Bitcoins to the crypto hedge fund company. Unable to recover the amount, Voyager had to take aid from Almeda Capital, gaining access to a revolving line of credit to meet customers’ liquidity needs.
The Current Crypto Pit can be Traced to the fall of TerraUSD
Voyager, Celcius, Babel, Three Arrows Capital, and a bunch of other crypto lending platforms can all trace their current circumstance back to the fall of TerraUSD in May. Once world’s most popular Stablecoin depegged from USD by almost 31% within a couple of minutes and lost all of its value within the next couple of hours.
The fall zapped $280 billion value from the crypto market. As faith in crypto started to vane, Bitcoin’s value plunged – going from above $42k to sub $20k within the first six months.
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Source: https://insidebitcoins.com/news/crypto-lender-voyager-halts-all-the-withdrawals-and-deposits