According to the company adthe credit line will be used to protect clients’ assets in light of current market volatility and only “if necessary”.
The market volatility threatening Voyager comes from Three Arrows Capital, an investment fund that has taken out a $350 million and 15,250 BTC loan from the company and has yet to repay it.
Voyager struggles to stay afloat even with Alameda loan
Alameda’s loan to Voyager is designed to help the platform meet its clients’ liquidity needs as the threat of default by Three Arrows Capital on their loan approaches.
Voyager’s operating subsidiary, Voyager Digital, said it could file a default notice with Three Arrows Capital (3AC) for defaulting on a loan of 15,250 BTC and $350 million. The company originally requested a refund of US$25 million by June 24th. However, market volatility and liquidity issues on the platform have forced Voyager to require the entire USD and BTC balance of 3AC to be redeemed by June 27th.
According to a statement from the company, none of these amounts have yet to be repaid, and failure to pay any request amount by June 27 will be considered a default. Voyager has said it intends to seek reinstatement from 3AC and is currently discussing the course of legal action it will take. However, the company said it could not estimate the amount of funds it would be able to recover from 3AC.
It is unclear whether the Alameda loan will allow Voyager to stay afloat. The company’s investment in 3AC is more than $150 million in excess of the loan it received from Alameda.
As of June 20, Voyager held approximately $152 million in cash and crypto assets, as well as approximately $20 million in cash restricted to purchase USDC. The Alameda loan, totaling about $500 million, brings the company’s total liquidity to $652 million.
The terms of the loan dictate that no more than $75 million can be used during any rolling 30-day period, and corporate debt must be limited to approximately 25% of clients’ assets on the platform. Voyager must also secure additional sources of funding over the next 12 months.
The provision of the loan gave Alameda indirect access to approximately 11.56% of Voyager’s outstanding shares.
Credit : cryptoslate.com