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Voyager notice of default spells more woes for Three Arrows

By Monte Stewart


Piece of paper and pen
Voyager Digital has issued a notice of default to Three Arrows, spelling more woes for the troubled crypto hedge fund. - Photo: Getty Images

Voyager Digital served a notice of default on Three Arrows on Monday, spelling more woes for the cryptocurrency hedge fund operator.

Voyager, a crypto lender, intends to pursue recovery of $650m (£529.57m) from Three Arrows, including 15,250 bitcoins (BTC) and $350m in the USDC cryptocurrency. The clock was ticking on Three Arrows, also known as 3AC, to make payment after Voyager demanded repayment of $25m by last Friday, 24 June, and the total balance by Monday.

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Company gets advice

Bitcoin was up Monday, so the amount of the loan value, in fiat currency terms, increased to $675m.

“Voyager intends to pursue recovery from 3AC and is in discussions with [Voyager’s] advisors as to legal remedies available,” Voyager said in a news release.


Firm also provides trading services

In addition to offering loans, Voyager provides trading services. The company allows more than 100 digital coins, ranging from bitcoin (BTC) to shiba inu (SHIB) to horizen (ZEN), be traded on its app.

Despite Three Arrows’ impact on its balance sheet, Voyager continues to operate. Alameda, owned by 30-year-old crypto venture capitalist Sam Bankman-Fried, provided Voyayer with $500m worth of credit recently.


Voyager accesses credit line

Voyager said it has accessed $75m from the line of credit.


0.00 Price
+18.010% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 22:00 (UTC)
Spread 0.00000338


0.62 Price
+0.690% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 22:00 (UTC)
Spread 0.01168


2,094.83 Price
+2.260% 1D Chg, %
Long position overnight fee -0.0616%
Short position overnight fee 0.0137%
Overnight fee time 22:00 (UTC)
Spread 6.00


0.01 Price
-1.950% 1D Chg, %
Long position overnight fee -0.0753%
Short position overnight fee 0.0069%
Overnight fee time 22:00 (UTC)
Spread 0.0005306

The company said it may continue to use the The ompany has accessed US$75 million of the line of credit made available by Alameda and may continue to make use of the credit facility to process customer orders and withdrawals as needed. The default of 3AC does not cause a default in the agreement with Alameda.

"We are working diligently and expeditiously to strengthen our balance sheet and pursuing options so we can continue to meet customer liquidity demands," said Voayager CEO Stephen Ehrlich, said in the news release.


Loan provided through subsidiary

Voyager provided the loan through a subsidiary, which is also the recipient of the Alameda credit facility.

The Three Arrows default does not cause a default in that agreement, said Voyager.


Markets in this article

Bitcoin / USD
38826.90 USD
1077.4 +2.850%
Shiba Inu / USD
0.00000857 USD
0.00000009 +1.090%

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The difference between trading assets and CFDs
The main difference between CFD trading and trading assets, such as commodities and stocks, is that you don’t own the underlying asset when you trade on a CFD.
You can still benefit if the market moves in your favour, or make a loss if it moves against you. However, with traditional trading you enter a contract to exchange the legal ownership of the individual shares or the commodities for money, and you own this until you sell it again.
CFDs are leveraged products, which means that you only need to deposit a percentage of the full value of the CFD trade in order to open a position. But with traditional trading, you buy the assets for the full amount. In the UK, there is no stamp duty on CFD trading, but there is when you buy stocks, for example.
CFDs attract overnight costs to hold the trades (unless you use 1-1 leverage), which makes them more suited to short-term trading opportunities. Stocks and commodities are more normally bought and held for longer. You might also pay a broker commission or fees when buying and selling assets direct and you’d need somewhere to store them safely.
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