Voyager loaned money to Three Arrows Capital - Not Good!
Crypto is having some problems. It appears that any protocol that required nothing to go wrong is having trouble when things go wrong. Three Arrows Capital borrowed 650 million dollars from Voyager and doesn't appear to be able to pay it back. This affects more than just the crypto world because Voyager happens to be a public company. Voyager stock has gone from about $2.50 per share down to about 50 cents.
I am not sure who had exposure to Voyager, but it is more than just crypto related companies. I would assume some hedge funds and mutual funds had a small piece of it for exposure to the crypto market.
In addition to breaking Wall Street a little, they are also screwing their customers. In the past a Voyager customer was able to withdrawal about 5 times more than they can now. They are going through a good old fashioned bank run. I bet they owe more money than they can come up with. Eventually, they will fold if people keep withdrawing crypto and they have nothing to hold or lend against.
Over the last 14 days VGX or Voyager token has had its price cut in half. If Voyager folds, I am pretty sure the token will fold too. Why would anyone use the platform?
This makes me also worried about Coinbase. I gave them a lot of credit for being a public company and having to put up with the scrutiny of the United States Securities and Exchange Commission. If the SEC could miss the red flags on Voyager then they could easily miss the red flags on companies like Coinbase.
Coinbase still doesn't have its own token or full ecosystem. I am starting to think that Kucoin and Binance might be the way to go for exchanges but if now more than ever, you need to stop keeping your money on an exchange.
You never know when Binance, Coinbase, Kucoin, Gate.io and any of the other centralized exchanges stop withdrawals in order to stay afloat. You are also not dealing with companies that have to follow the law. The government can't easily seize crypto assets. They can't work with a bank to take them and if the assets aren't being kept in a centralized exchange, the government would need to literally force the person to give them the crypto by imprisoning them.
Voyager Digital and Three Arrows Capital are two prominent players in the cryptocurrency industry.
Voyager Digital is a publicly traded, licensed crypto-asset broker that allows users to buy, sell, and trade a wide range of cryptocurrencies, including Bitcoin, Ethereum, and Litecoin. The company was founded in 2018 by a team of financial industry veterans and technology experts, and it has quickly become one of the leading crypto brokers in the United States.
One of the key features of Voyager is its "smart order routing" technology, which uses algorithms to automatically execute trades on multiple exchanges and liquidity pools, in order to get the best prices and minimize slippage. The company also offers a range of tools and resources for investors, including market insights, educational materials, and a mobile app that allows users to track their portfolio and place trades on the go.
Three Arrows Capital, on the other hand, is a Singapore-based hedge fund that focuses on investing in cryptocurrency and blockchain-related projects. The firm was founded in 2013 by Su Zhu, a well-known figure in the crypto industry, and it has since become one of the largest and most influential crypto investment firms in the world.
Three Arrows Capital is known for its expertise in quantitative trading and risk management, and it has made a number of successful investments in a wide range of crypto assets, including Bitcoin, Ethereum, and DeFi tokens. The firm is also actively involved in the broader crypto ecosystem, participating in research and development projects, supporting startups, and working to promote the adoption and development of blockchain technology.
Both Voyager Digital and Three Arrows Capital are key players in the cryptocurrency industry, and they are helping to shape the future of finance and technology.