Three Arrows Capital gets a default notice for failing to make due payments
Today, June 27, Voyager Digital Ltd. announced that its operating subsidiary, Voyager Digital LLC, has filed a notice of default with Three Arrows Capital (3AC) for failing to make the required payments on its previously reported loan of 15,250 Bitcoin (BTC) and $350 million USDC.
According to a PRNewswire article, Voyager wants to seek recovery from 3AC and is now discussing the different legal alternatives available to it with its advisors.
Notably, the platform continues to operate regularly, completing customer purchases and processing withdrawals.
As of June 24, 2022, Voyager possessed around $137 million in cash and crypto-assets. In addition to the previously stated $200 million cash and USDC revolver, the business has access to a 15,000 BTC revolver issued by Alameda Ventures Ltd.
Future usage of Alameda’s facilities to facilitate customer orders and withdrawals is conceivable. The credit line has already been used for $75 million. Due to 3AC’s default, the agreement with Alameda is not regarded to be in default.
Stephen Ehrlich, Voyager’s chief executive officer, stated: “We are aggressively and swiftly strengthening our balance sheet and seeking solutions so that we can continue to satisfy the liquidity needs of our customers.” In addition, Voyager has hired Moelis & Company to serve as financial advisors for this endeavor.
Voyager Digital imposes withdrawal limits
As previously reported by Finbold, crypto broker Voyager Digital significantly reduced its daily withdrawal limit on June 22 after reporting its exposure to the Singapore-based hedge fund Three Arrows Capital, which was severely impacted by a sell-off in the cryptocurrency market.
The website of Toronto-based Voyager Digital was changed at 23:00 UTC on June 22 to reduce the number of withdrawals permitted within 24 hours from $25,000 to $10,000, with a maximum of 20 withdrawals.
It’s important to note that 3AC is a big and active participant in the cryptocurrency business, having stakes throughout the lending and trading landscape, including investments in BlockFi and Genesis, which were among the organizations selling some of 3AC’s positions.