Voyager Digital (TSX) is another company reported to have been affected by the financial difficulties relating to Three Arrows Capital (3AC). In a letter to investors, Voyager’s management explained that 3AC potentially defaulted on a $655 million loan and it hopes to obtain some of the funds by the end of this month.
The Three Arrows Contagion: 3AC Owes $655 Million to Voyager Digital — Management Has Set a Repayment Date
3AC’s financial hardships have seemingly started a contagion throughout the crypto industry and while a number of firms said they were safe, others explained they were suffering from the fallout. Finblox, for example, is a 3AC-backed company. detailedOn June 16, the company announced that rewards up to 90% in APY had been halted for all users. The platform also increased withdrawal limits. Voyager Digital, a publicly traded crypto company, revealed this week that it is dealing with 3AC issues.
In a letter sent to Voyager’s investors on Wednesday, the company disclosed it was owed $655 million and 3AC was supposed to pay the funds back in bitcoin (BTC) and the stablecoin usd coin (USDC). According to Voyager, Voyager owes 350 million USDC and 15,250 BTC. The management stated that it initially requested $25 million USDC be paid by June 24. However, now the company wants all USDC and BTC to be paid by June 27.
TSX-Listed Stock VOYG-T Loses Half of Its Value in a Day — Voyager Is ‘Unable to Assess at This Point the Amount It Will Be Able to Recover’
The news seemingly did not sit so well with Voyager investors as the company’s shares dropped 53% in value during a 24-hour period. Currently the TSX-listed stock VOYG/T is at $52.76 per unit. VOYG-T traded hands on June 21 for $1.60 per shares. In March 2021, VOYG-T reached an all-time high of $32.68 per shared. VOYG-T currently trades at 97% less than its ATH, and has fallen steadily since the fall in crypto market value. The 3AC loan default announcement added another blow to the value of the company’s shares.
Voyager states that it does not know whether the USDC initial payment request and the balance request will be honored. “Neither of these amounts has been repaid, and failure by [Three Arrows] to repay either requested amount by these specified dates will constitute an event of default,” Voyager said. “[The company is] unable to assess at this point the amount it will be able to recover.” Bitcoin.com News recently reported on Three Arrows Capital and explained how the company’s founders have been silent about the situation.
3AC co-founder Kyle Davies did disclose to the Wall Street Journal (WSJ) that the Terra LUNA and UST fallout hurt the company and plans were being made to find an “equitable solution” for all of 3AC’s constituents. Furthermore, 3AC allegedly tried to pitch a GBTC arbitrage trade to a lot of big name investors a few days before the company’s rumored collapse. Besides Finblox, Voyager, and 3AC, Mike Novogratz’s Galaxy Digital has seen its shares plummet significantly since the Terra LUNA and UST fallout. Galaxy’s shares are down close to 90% from the share’s price highs in mid-November.
Novogratz was silent for some time after the Terra disaster, but then he published an apology and said that Galaxy didn’t suffer too much from it. Novogratz stated that Galaxy remained true to the core principle of investing, which is only investing in things you can lose. Novogratz is now more active in social media than many other people who have invested or promoted Terra.
Voyager Digital is facing problems with 3AC, the crypto hedge fund. What are your thoughts? Please comment below to let us know your thoughts on this topic.
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