Voyager Digital said that all trading, deposits, withdrawals, and customer reward programs have ended in a statement. Friday afternoon, the statement came out. Stephen Ehrlich, the CEO of Voyager, said that even though this was a hard decision, they think it’s the right one given how the industry is doing. If you are interested in bitcoin trading, you should look into various websites such as Bitcoin Storm app.
Erlich said the change would give the company more time to “explore strategic options with several interested partners.” He also said that more information would be given “right time.”
Voyager’s comment comes when margin calls and defaults are causing a lot of trouble in the business world. The digital broker is the most recent person to lose money because many people sell cryptocurrencies.
Bitcoin and Ether, the two most-traded cryptocurrencies, have lost more than 70% of their value since their peaks in November 2017. Also, when the UST stablecoin failed in May, it sent shock waves through an already troubled market.
A few days ago, it was said that one of Voyager’s customers owed several hundred million dollars that hadn’t been paid back. People worried that this would hurt the business in the long run.
In a letter sent on Monday, the broker said that the big cryptocurrency hedge fund Three Arrows Capital (3AC) had not paid back a debt of more than $670 million. At the time, Voyager told 3AC it would try to get the money back. In the meantime, it was said that the ATM would stay open and let people buy things and take money out.
Voyager said on June 24 that it had about $137 million in cash and digital money in the United States. Sam Bankman-Fried, who started FTX, also started a quantitative trading company called Alameda Ventures. This company gave FTX access to a credit line for $200 million in cash and USDC stablecoins and a credit line for $318 million for 15,000 bitcoin.
Alameda said last Thursday that it would give $500 million to Voyager. The company has borrowed $75 million from its credit line in the past, but it looks like that wasn’t enough to keep doing business as usual.
Based on their market value, Bitcoin and Ethereum are the two most valuable cryptocurrencies in the world. Still, investors don’t seem too worried at the moment. Near the end of a normal trading day on Wall Street, the price of bitcoin has gone up by about 2%, and the price of Ethereum has gone up by more than 4%.
Voyager competes with BlockFi, a new business that lets people borrow bitcoins. BlockFi and Voyager have lost money because there isn’t enough money in the market. The Block says that FTX just signed a $680 million credit agreement so it can buy BlockFi.
Voyager users won’t be able to switch accounts, move money between accounts, or take money out of their accounts after June 13. This is similar to what a popular website for staking and lending bitcoins did. Because “the market was so bad,” the same thing happened again on June 13. Celsius hasn’t said what we should do yet.
When Voyager’s clients gave it money, it was put into pools of assets
From what was shown in court, Voyager did not keep each user’s bitcoin in a separate wallet.
Sam Bankman-Alameda Fried did work for Voyager that was worth $376,8 million. This makes it the second-biggest creditor to the company.
After that, where should they go?
Experts say that people who borrowed bitcoins from companies like Celsius Network that went out of business may be able to write them off as bad debt. Shehan Chandrasekera, a certified public accountant and the chief tax strategist at CoinTracker, told CNBC that money that is “totally useless and can’t be gotten back” is a loss.