The Toronto-based lender has filed for Chapter 11 bankruptcy in New York.
The Toronto-based lender announced the filing of a Chapter 11 bankruptcy petition in New York late on Tuesday.
Voyager Digital, a crypto lender, filed for bankruptcy late on Tuesday. The firm is the second high-profile crypto company to do so in recent days.
Voyager, a Toronto-based firm, filed for Chapter 11 bankruptcy protections in Southern District of New York on Tuesday, saying it has between 100,000 and 1 billion in assets and liabilities each.
The company states in the filing that "money will be available for distribution to unsecured creditors,"
The three Voyager Digital companies filed for bankruptcy.
Three Arrows Capital, along with Voyager, filed for bankruptcy. Three Arrows, however, filed a Chapter 15 petition that was related to an ongoing liquidation ordered by a court in the British Virgin Islands.
According to Frances Coppola, Three Arrows accounted for nearly half of Voyager's total assets, and almost 60% of its loan book was composed of loans to Three Arrows.
The "FDIC" has protections?
As industry watchers intensify their scrutiny of Voyager's business practices, especially how the Canadian-listed firm marketed deposits' Federal Deposit Insurance Corporation (FDIC) insurance to customers, the filing is expected.
While FDIC insurance would indeed protect bank-held cash deposits up to $250,000, it would not cover cash converted to stablecoins. Commentators including Coppola have criticised Voyager's marketing around its handling of deposits as misleading.
In addition, the FDIC insurance applies in the case of a bank failure - in this instance, Voyager was banked by Metropolitan Bank of New York. There is no protection for a Voyager failure.
