Sun. Aug 14th, 2022
“I am ruined”: customers despair after cryptocurrency company bankruptcy

After the Three Arrow Capital case, another cryptocurrency company announced bankruptcy, Voyager Digital, which is also leaving a billion-dollar loss for the sector, in addition to leaving several investors and customers desperate, afraid they have lost all their savings. Voyager’s recent chaos is a direct reflection of Three Arrow Capital’s (3AC) default, as the company also went into embezzlement due to 3AC’s lack of payments, which prompted the company to announce bankruptcy last Wednesday. The company officially announced bankruptcy by filing the documents with the US Bankruptcy Court, Southern District of New York. The exchange has two branches, the primary Voyager Digital Holdings and the Voyager Digital, both headquartered in the same US state. Despite everything, so far, the company guarantees that throughout the process Voyager will continue to operate and that the objective is to recover the assets and “come out stronger” from the situation.

“Voyagers, today we began a voluntary restructuring process to protect the assets on the platform, maximize value for all shareholders, especially customers, and emerge from the situation an even stronger company. Voyager will continue to operate during the process.”

Despite this optimism on the part of Voyager’s CEO, customers are desperate that they have lost years of savings with the company’s current situation. Vice has interviewed some of these customers and investors, who are really concerned about the situation.

Voyager customers believe they will lose their assets

According to the site, an investor called Jeffery Cosey, The 37-year-old believed that Voyager represented a better way to store his money than a traditional bank, citing the bonuses he received for deposits and the possibilities for a higher return on his investment.

“They all looked trustworthy. They looked legit, it wasn’t something that felt suspicious or risky.”

Cosey said he ended up depositing about 90% of all his savings on Voyager, his investments were made in Bitcoin, Ethereum, and other smaller cryptocurrencies, in addition to USD Coin, a dollar-backed stablecoin. While Cosey was waiting for the possibility of the crypto market to crash, he says he was in disbelief at how Voyager managed its clients’ money.

“I never thought a publicly traded company could stake my money like that. That was the risk I didn’t understand.”

In this case, Voyager made a loan to 3AC of US$ 650 million, but, as we already know, the company defaulted on its creditors and left Voyager at a loss, precisely in the midst of a large drop in the cryptomarket, which left everything even more difficult. Cosey wasn’t the only investor heard by the publication, with a Chicago financial adviser also being caught off guard by Voyager’s bankruptcy.

“I’m ruined. I have to start my life all over again,” said the financial adviser.

The worst part about Voyager, as well as 3AC, is that cryptocurrency companies were doing just what traditional banks do, but with the added risks of cryptocurrency. That is, many of these companies are operating with the disadvantages of both sectors, digital and traditional, exposing their customers to various risks, often without exposing these risks to customers. With these situations, it is now more than necessary to pay attention to where you invest your savings in the crypto market.