The current state of the crypto market continues to hit hard for Voyager Digital (TSX: VOYG). The firm late last night quietly announced changes to withdrawal limits amid what appears to be liquidity problems.
Withdrawal limits were reduced on Wednesday from $25,000 per day to just $10,000 per day, with the changes being formally made at 23:00 UTC. Withdrawals are also capped at a 20 transaction limit within a 24 hour period.
The changes occurred the same day in which the company revealed roughly $655 million in exposure to Three Arrows Capital, the major crypto hedge fund that is currently facing insolvency. Voyager detailed that they had loaned the fund 15,250 bitcoin along with $350 million USDC, representing 28.3%, and 55.3%, respectively, of all funds it had loaned out in those currencies.
Repayment of the debt has reportedly been demanded, with $25 million due tomorrow on June 24, while the balance of the entire loan is due as of June 27. If the required payments are not made the debt will be viewed as being in default, and the firm intends to take the actions necessary to recover the loan. Whether they will be able to recover anything however is questionable.
The company notably three days ago announced it had entered an agreement with Alameda Research for a credit facility for US$200 million in USDC, as well as 15,000 bitcoin. The arrangement was finalized yesterday.
Voyager yesterday commented that it had $152 million in cash and crypto assets on hand, as well as $20 million that is restricted for the purchase of USDC. The state of that balance today however is up in the air, as the recently imposed reduced withdrawal limits suggest that clients were looking to move money off the platform with haste.
Voyager Digital last traded at $0.86 on the TSX.
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As the founder of The Deep Dive, Jay is focused on all aspects of the firm. This includes operations, as well as acting as the primary writer for The Deep Dive’s stock analysis. In addition to The Deep Dive, Jay performs freelance writing for a number of firms and has been published on Stockhouse.com and CannaInvestor Magazine among others.