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Voyager urges Alameda Research to repay $200M loan

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Voyager urges Alameda Research to repay $200M loan

Voyager urges Alameda Research to repay $200M loan Oluwapelumi Adejumo · 10 hours ago · 1 min read

Voyager asked the court to keep the crypto wallets that would be involved in the transactions private.

1 min read

Updated: September 20, 2022 at 9:50 am

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Cover art/illustration via CryptoSlate

Bankrupt Voyager Digital requested that crypto trading firm Alameda Research repay its $200 million loan in a Sept. 19 court filing.

According to the filing, Alameda would repay 6,553 BTC (roughly $128 million) and 51,204 ETH ($70 million) to the bankrupt firm. The filing revealed that the Voyager loan included other crypto assets like USDC, Dogecoin (DOGE), Voyager Token (VGX), Chainlink (LINK), Luna Classic (LUNC), Litecoin (LTC), etc.

In return, Voyager would release Alameda’s $160 million collateral. Voyager requested that the loan be repaid by Sept. 30 at the latest.

In July, Alameda said it would be happy to return Voyager’s loan to get its collateral back.

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Voyager wants crypto wallets redacted

Voyager requested the court to keep the crypto wallets that would be involved in the transactions private.

According to Voyager, making Alameda’s crypto wallet public would provide commercially sensitive information to the public, leading to “unwarranted speculation and attention surrounding any account activity.”

$500M

TSX-Listed Voyager Digital ‘Temporarily’ Suspends Trading, Deposits, And Withdrawals

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TSX-Listed Voyager Digital ‘Temporarily’ Suspends Trading, Deposits, And Withdrawals

After the TSX-listed Voyager Digital revealed that it was owed $655 million from Three Arrows Capital (3AC), the company secured a $500 million credit line from Alameda Ventures in order to “safeguard customer assets.” Five days later on July 1, Voyager announced the crypto company was “temporarily suspending trading, deposits, withdrawals and loyalty rewards.”

Another Crypto Firm Freezes Withdrawals, Voyager CEO Says ‘It Was a Tremendously Difficult Decision’

  • The embattled digital currency firm Voyager Digital (OTCMKTS: VYGVF) announced a temporary withdrawal and deposit pause on Friday, according to a recent press release. Voyager explained that it was “temporarily suspending trading, deposits, withdrawals and loyalty rewards, effective at 2:00 p.m. Eastern Daylight Time today.”
  • “This was a tremendously difficult decision, but we believe it is the right one given current market conditions,” Stephen Ehrlich, the chief executive officer at Voyager said in a statement.
  • VYGVF shares plummeted to $0.29 per share after the previous close at $0.44 per share on Thursday. Shares have lost 99% since the stock’s all-time high at $27.39 per share on April 1, 2021.
Voyager Digital (OTCMKTS: VYGVF) closed the day at $0.31 on Friday, July 1, 2022.
  • “This decision gives us additional time to continue exploring strategic alternatives with various interested parties while preserving the value of the Voyager platform we have built together,” Ehrlich added. “We will provide additional information at the appropriate time.”
  • In addition to the update concerning deposits, withdrawals and loyalty rewards, Voyager summarized 3AC’s debt to the company. “Voyager also provided the following financial and balance sheet updates, per requirements of Canadian securities laws,” the company explained.
  • Just last week, Voyager opened a credit line with Alameda Ventures and said it secured a revolving $500 million line of credit from the firm. The announcement came after Voyager revealed that it was owed $655 million in the form of bitcoin (BTC) and the stablecoin usd coin (USDC).
  • Furthermore, Voyager has also disclosed that it is working with Kirkland & Ellis LLP for legal assistance and Moelis & Company and The Consello Group for financial advice.
  • Voyager’s withdrawal pause follows the suspension of withdrawals the crypto lender Celsius initiated weeks ago. Celsius has yet to update the community concerning the company’s official plans to resolve its financial hardships.
  • However, on Thursday, Celsius published a blog post that says the firm is “focused and working as quickly as we can to stabilize liquidity and operations.” Celsius further said that it was “pursuing strategic transactions,” and “restructuring” liabilities, “among other avenues.”
  • On the same day Voyager temporarily froze the exchange’s main operations, Blockfi co-founder Zac Prince disclosed that Blockfi lost roughly $80 million due to 3AC exposure and stressed it was “a fraction of losses reported by others.”
  • Voyager’s announcement also discussed “the court-ordered liquidation process in the British Virgin Islands” as the crypto firm said that it was “actively pursuing all available remedies for recovery from 3AC.”

What do you think about Voyager Digital temporarily pausing withdrawals? Let us know what you think about this subject in the comments section below.

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Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,700 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits: Shutterstock, Pixabay, Wiki Commons, Editorial photo credit: T. Schneider / Shutterstock.com

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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$500M

Crypto Firm Voyager Digital Secures A $500M Line Of Credit From Alameda Ventures To Cope With 3AC Exposure

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Crypto Firm Voyager Digital Secures A $500M Line Of Credit From Alameda Ventures To Cope With 3AC Exposure

Three days ago, Bitcoin.com News reported on the publicly listed company Voyager Digital after the crypto firm announced that it was owed $655 million worth of digital assets. Now according to a press release from Voyager, the company has secured funds from Alameda Ventures in order to get more access to liquidity.

Voyager Borrows $500 Million from Alameda

Voyager Digital Holdings, Inc. has revealed a collaboration with Alameda Ventures as the venture company has provided Voyager with a line of credit. The funds are “intended to help Voyager meet customer liquidity needs during this dynamic period.” Last week, reports noted that Voyager was suffering through financial hardship due to its exposure with Three Arrows Capital (3AC). Voyager said in a note to investors that it is owed 15,250 BTC and 350 million USDC, and the company gave 3AC a deadline to pay back the funds.

Voyager’s TSX-listed stock plummeted after the announcement losing more than 50% in value in less than 24 hours. By borrowing from Alameda, Voyager will use the funds to meet customer liquidity demands and strengthen operations during the crypto market volatility. “[Voyager] entered into a definitive agreement with Alameda for a US$200 million cash and USDC revolver and a 15,000 BTC revolver,” Voyager said in a statement. The company added:

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As previously disclosed, the proceeds of the credit facility are intended to be used to safeguard customer assets in light of current market volatility and only if such use is needed.

Alameda Applies Certain Loan Conditions

Meanwhile, the news follows the crypto lender Blockfi securing a $250 million line of credit from FTX. Following the loan, a report published by the Wall Street Journal claims that FTX is discussing purchasing a stake in Blockfi. While Alameda is offering Voyager funds, there are some conditions that Voyager must abide by. For instance, “Alameda’s obligation to provide funding is subject to certain conditions, including: no more than US$75 million may be drawn down over any rolling 30-day period.” The loan agreement summary further adds:

[Voyager’s] corporate debt must be limited to approximately 25 percent of customer assets on the platform, less US $500 million; and additional sources of funding must be secured within 12 months.

Voyager still intends to pursue assets from 3AC and has been discussing the “legal remedies available.” The announcement notes that Voyager is “unable to assess at this point the amount it will be able to recover from 3AC.” On June 21, Voyager’s shares listed on TSX were trading for $1.23 per unit, and today, the stock is exchanging hands for $0.58 per unit. Additionally, Alameda indirectly holds 22,681,260 common shares of Voyager, equating to 11.56% of outstanding common and variable voting shares.

What do you think about Voyager securing a line of credit from Alameda? Let us know what you think about this subject in the comments section below.

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Jamie Redman

Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits: Shutterstock, Pixabay, Wiki Commons

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Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.

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This analyst decodes the mystery behind Celsius’ crippling meltdown

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This analyst decodes the mystery behind Celsius’ crippling meltdown

It is true the bear market is raining down on the entire cryptocurrency market. But the devastation has been more painful for some. Celsius is certainly a leading highlight of the crippling crypto institutions that is rumored to be edging towards insolvency.

An overheated matter

Celsius had more than $8 billion lent out to clients and $12 billion in assets under management by May 2022, according to the company. However, rumors about insolvency started spreading after it announced the freezing of account transactions.

Celsius announced on 12 June evening that withdrawals and transfers between accounts will be frozen, citing ‘extreme market conditions’. This move saw over $11.8 billion in customer assets being frozen. Five days in and the assets are still not released amid a huge crypto market turmoil.

CEO Alex Mashinsky even confirmed that exposure to the Terra debacle was ‘small’ after his firm’s early exit.

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So where did it all go wrong for Celsius?

The major error appears to be the investing customers’ ETH in Lido Finance as staked Ethereum or stETH. However, the crypto crash led to the massive dumping of stETH and 1 stETH was no longer redeemable for one ether. This jeopardized the position of Celsius.

“Celsius promised customers between 6% and 8% returns on ether deposits. It had at least $450 million in stETH in its primary DeFi wallet, but likely has more stored elsewhere,” according to Andrew Thurman, Analyst at Nansen.

The clock is ticking for Celsius right now but a prominent analyst has a different theory for its crisis.

More twists in this tale

Crypto analyst “Plan C” alleges a different theory for the Celsius crisis. The analyst believes that two key players namely, FTX and Alameda Research, conspired to the demise of Celsius. He cut open the wounds of the Terra crash when TFL CEO Do Kwon was looking for bailouts. CEO Mashinsky confirmed in a tweet that Celsius is not a part of it.

While Celsius got out, FTX and Alameda were stuck in the Luna ‘bailout’. As per ‘Plan C’, they lost huge amounts of money holding “UST and locked Luna bags”.

10/25 – #Celsius got out the door first, suffered the lowest loses and didn’t want any part of the bailout.

Stuck holding the #UST and (locked) #Luna bags, losing $100’s of millions of dollars each…

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✔️ Alameda (FTX) 🦈

✔️ 3 Arrows Capital

✔️ Galaxy Digital

✔️ Jump Capital

— Plan©️ (@TheRealPlanC) June 16, 2022

The analyst then regards the track record of Alameda Research as evidence of potential wrong-doings. In the same thread, there is on-chain data claiming Alameda Research did swap around 50,000 stETH to ETH. This liquidation started piling pressure on Celsius and eventually, market volatility took charge.

Source: Plan C

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Fast forward to today, we now have a crypto market at one of its lowest points.

Kanav is a journalist at AMBCrypto. He has a Masters in Media and International Conflict and is interested in areas of digital society, crypto developments in the political sphere and the socio-cultural impact of a crypto-society.

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