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$500 million to save a trading giant – The 3AC crisis does enormous damage

An endless chasm caused by a giant – The platform of trading Travel Digital is she playing her last card before an increasingly probable bankruptcy? The company benefits from a financial support relatively important. But even a 9-figure loan no longer seems to be enough.

$200 million to continue the journey

Travel Digital announced, in a press release dated June 22, 2022, the conclusion of a definitive agreement on a credit facility with Alameda Research.

The fund created by Sam Bankman-Fried (BSF) will grant Voyager a $200 million loan U.S. dollars, in cash and USDC, and 15,000 BTC.

The company will use these funds to meet cash needs of its customers in the current context. In addition, it will only use this cash in case of ultimate necessity.

The actual disbursements of this loan by Alameda are however subject to certain terms :

  • Travel ncan receive more $75 million US over a rolling 30-day period;
  • The debt of the company cannot exceed 25% the value of customer assets on the platform being less than $500 million;
  • Voyager Digital must find additional funding sources within 12 months.

In addition to this loan, which theoretically provides a safety net for Voyager Digital and its customers, the press release points out that the company also has, as of June 20, 2022:

  • About $152 million Americans in cash and cryptocurrencies;
  • About $20 million in cash for the purchase of USDC.

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An inevitable crash due to contagion

Will this $200 million loan bail out Voyager’s portfolios enough? In reality, the company could still go bankrupt because of the difficulties meets Three Arrows Capital (3AC).

Indeed, Voyager Digital announced, on June 22, 2022, that its global exposure with Three Arrows Capital amounts to $661 million in stablecoins and bitcoins. However, the hedge fund could be in theinability to repay this loan.

Voyager indicated that he could then issue a ” Notice of Default “ at Three Arrows Capital. The company requested a refund of $25 million in USC Coin (USDC) before June 21.

It could also later submit a request for full reimbursement in USDC and BTC before June 27, 2022. And despite this $200 million credit facility, Voyager Digital has limited daily withdrawals on its platform, going from $25,000 to $10,000.

Three Arrows Capital has been liquidated by five cryptocurrency platforms. How many crypto companies will, in turn, be victims of the fund’s failure?

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