Toronto-Based Crypto Lender Voyager Digital Files for Bankruptcy
The ongoing crypto crash has claimed yet another name. Canadian cryptocurrency lender Voyager Digital filed for bankruptcy on Tuesday — reports CoinDesk.
The publicly traded company, headquartered in Toronto, filed for Chapter 11 bankruptcy protection in the U.S. Southern District Court of New York. Voyager estimates it has between $1 billion and $10 billion worth of assets, and it owes just as much to more than 100,000 creditors.
According to the filing, the company believes that “funds will be available for distribution to unsecured creditors.”
Voyager’s bankruptcy filing comes after the company restricted withdrawals in recent days. Close to 60% of Voyager’s loan book consisted of sums lent to Three Arrows Capital, a Singapore-based cryptocurrency hedge fund that itself filed for bankruptcy last month. The company said in a blog post that Three Arrows owes it $650 million.
Voyager’s stock has taken a beating and then some in recent months, dropping from a high of more than $20 in November to less than $1 last month.
The company is now looking to restructure and move forward. Voyager CEO Steven Ehrlich said in a statement that reorganizing the company “is the best way to protect” it and all of its assets.
“Customers with crypto in their account(s) will receive in exchange a combination of the crypto in their account(s), proceeds from the 3AC recovery, common shares in the newly reorganized Company, and Voyager tokens,” Ehrlich told customers on Twitter.
As of Wednesday morning, the trading of Voyager shares has been suspended at the Toronto Stock Exchange at $0.34. Voyager is expected to be delisted from TSX soon.
Meanwhile, another Canada-based crypto exchange, Montreal’s Shakepay, reached one million Canadian users in March. Click here to sign up for Shakepay and get $30 free after your first $100 crypto purchase.
Disclosure: Shakepay is an affiliate partner that allows readers to support the site. Invest in volatile cryptocurrency at your own risk.