- After months of pressure and dilemma, Voyager Digital finally, on 6 July, filed for bankruptcy.
- Voyager CEO Stephen Ehrlich highlighted that the prolonged volatility and contagion coupled with the default of 3AC on loan had forced them to take drastic measures.
After months of reeling under pressure bearish market, Voyager Digital finally filed for bankruptcy on 6 July. The announcement came just a week later it had suspended withdrawals, trading, and deposits to its platform as it tried a last-ditch effort to explore alternatives.
Voyager Digital had been under the pump following its disclosure of loans made to the Three Arrows Capital (3AC) fund on 23 June. The Toronto-based firm reportedly loaned roughly US$350 million worth of the stablecoins USDC and 15,250 Bitcoin to 3AC. Later, Voyager issued a notice of default to 3AC on 27 June, following which several of its investors developed cold feet.
With the disclosure of its loans, Voyager's shares crashed by over 60% on 23 June, staring at a possible loss of over US$650 million. The latest development seems to be that the potential losses have swelled up with over 100,000 creditors with approximately US$1 billion and US$10 billion in crypto assets.
The bearish crypto markets have worsened the situation for Voyager Digital, resulting in the firm taking such a drastic step. Voyager Chief Executive Officer Stephen Ehrlich said that the prolonged volatility and contagion coupled with the default of Three Arrows Capital on loan had forced them to take this drastic step.
He added that a comprehensive reorganisation was perhaps the best way to protect the stakeholders and assets.
How is the Voyager crypto coping with the news?
The Voyager Token (VGX), which had already lost over 98% of its value since it achieved its all-time high on 6 January 2018, was down by 14.29% at 1:00 PM (GMT +1), according to CoinMarketCap.
VGX token has been on a decline losing 76% in the past 30 days. Over the past week, it was further dented as it lost 26.6%, effectively creating a nightmare for its investors.
Image Credit: Trading View
As of 6 July, the RSI of Voyager Token indicated a nosedive with investors looking to most of their investment. The RSI on Wednesday stood at 24.48, and even the MACD line indicated a downward slide.
This has been a significant change as the last time VGX crypto witnessed green was on 2 June. Since then, neither volume-wise nor pricewise, it has managed to get any momentum.
VGX's price performance
The VGX crypto on Wednesday was trading at US$0.209285 with a volume of US $1,15,15,573. The 329-ranked crypto had a live market cap of US$5,82,82,105 with 27,84,82,214 VGX coins in circulation.
Voyager Digital has yet to clarify how investors can still make the most from their investments. Voyager Digital’s bankruptcy news has come just after the Terra stablecoin collapse in May, and the bearish sentiments in the market have only added to the uncertainty among the market participants. Therefore, in such a scenario, it's critical that the investors do their market research and closely follow the trends to ensure they don't decide out of haste or panic.
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