Crypto Market has seen a lot of firms filing for bankruptcy, majorly due to the drastic drop in crypto prices. Recently, Voyager, a crypto lending firm became the latest firm to file for bankruptcy.
Last week, Voyager announced that they are suspending withdrawals, trading, and deposits to its platform. Today, the New Jersey-based firm estimated that it has more than 100,000 creditors and somewhere between $1 billion and $10 billion in assets and liabilities worth the same value.
The company filed for Chapter 11 bankruptcy yesterday, putting a hold on all civil litigation matters. Basically, companies try to prepare turnaround plans while remaining operational.
Voyager’s chief executive officer, Stephen Ehrlich, talked about the situation:
“The prolonged volatility and contagion in the crypto markets over the past few months, and the default of Three Arrows Capital on loan from the company’s subsidiary, Voyager Digital, LLC, require us to take deliberate and decisive action now.”
Besides this, the chief executive said on his Twitter handle that the process would protect assets and “maximize value for all stakeholders, especially customers”.
According to the U.S. Bankruptcy Court Southern District of New York filing, Alameda Research becomes the firm’s largest creditor, with unsecured loans of $75 million.
Many crypto firms have fallen apart due to unfavourable market conditions. Last month, popular crypto lending firm Celsius Network paused withdrawals and transactions for the same reason. It raised many eyebrows in the crypto community, and following that, crypto lending firms such as Vauld also announced a pause on withdrawals and transactions.