Voyager Plunges 60% After Revealing $661M Exposure To 3AC

Voyager plummeted 60% during regular trading hours on June 22 before closing at $0.5998, down 50.84% on the day.

 

Voyager Digital’s shares price have plunged 60% since it disclosed its Three Arrows Capital (3AC) exposure, along with further drops in crypto industry stocks.

 

According to data from TradingView, Voyager Digital plunged as much as 60% during regular trading hours on Wednesday before closing at $0.5998 to mark a drop of 50.84% for the day.

 

The sharp drop followed Voyager Digital disclosing that the potentially insolvent Three Arrows Capital (3AC) owes the company 15,250 Bitcoin (BTC) and 350 million USD Coin (USDC), worth around roughly $660 million in total.

 

Voyager has given 3AC until June 24 to pay $25 million and until June 27 to pay full the amount before the loan will be considered in default. The company also stated that it is working with lawyers on how to pursue legal action against 3AC should the supposed venture fund be unable to repay its debt.

 

Alameda Research has extended a 200 million USDC revolving loan and a 10,055 BTC revolving loan to cover Voyager’s current liquidity troubles. The company has also tightened its 24-hour withdrawal limit this week from $25,000 to $10,000.

 

“$10,000 better than $0 at Celsius,” commented Redditor AdLongjumping5010 in the r/CelciusNetwork sub-Reddit in response.

 

Other crypto-related stocks continued to suffer. Coinbase stock suffered a 9.71% dip to $51.91, while the heavily BTC exposed MicroStrategy led by Michael Saylor saw its shares drop 4.50% to $170.91.

 

Crypto mining stocks also saw notable damage, with Riot Blockchain shedding 9.63%, while Bitfarms, Hut 8, Marathon Digital Holdings and Core Scientific all dropped around 5-7% a piece.

 

The crumbling prices of crypto stocks are just a microcosm of a broader downward trend in the stock and crypto markets in 2022, with the benchmark S&P 500 Index in the bear market territory and down 21.6% since the start of the year. This marks the first time this has happened since 1970, according to Bloomberg data.

 

Investors have, in general, been spooked by the United States Federal Reserve’s monetary policy and efforts to curb inflation this year by introducing a series of interest rate hikes.

 

Fed Chairman Jerome Powell, however, has been noncommittal about how the government agency will respond to recent inflation, but he did hint that it may be preparing for a recession as the Fed continues to push up borrowing costs.

 

In testimony to the Senate Banking Committee on Wednesday, Powell said in response to a question from Senator John Tester that “it’s certainly a possibility,” adding that “It’s not our intended outcome, but it’s certainly a possibility.”