Struggling crypto lender and trader Voyager Digital started the week in limbo on Monday after the company froze transactions, deposits, withdrawals and loyalty rewards amid a tougher fight for survival.

Meanwhile, struggling hedge fund operator Three Arrows has been rocked after being criticized by the Monetary Authority of Singapore for providing ‘misleading information’ about its investments and filing for bankruptcy protection in the states. -United.

The loan includes $350 million from USDC

Voyager announced on Friday that it was temporarily suspending transactions, deposits, withdrawals and loyalty rewards. The move came after Voyager’s operating subsidiary gave notice that Three Arrows had defaulted on a debt now valued at around $650 million (£536.8m). The loan includes $350 million USDC and 15,250 bitcoins (BTC).

“This was an extremely difficult decision, but we believe it is the right one given current market conditions,” Voyager CEO Stephen Ehrlich said in a press release. “This decision gives us more time to continue exploring strategic alternatives with various interested parties while preserving the value of the Voyager platform we have built together. We will provide additional information at the appropriate time.

Voyager said it is actively pursuing all available remedies to collect debt from Three Arrows, also known as 3AC. In addition to freezing its key businesses, Voyager is exploring “strategic alternatives” and has engaged Moelis & Company and the Consello Group as financial advisers and the law firm Kirkland & Ellis for legal advice.

Voyager investors did not seem reassured, however. The company’s token (VGX) fell most of Monday before rallying later in the day, and Voyager (VOYG) stock closed down 42.24% in Toronto on Monday.

The company’s press release and a series of tweets attempted to paint a solid financial picture. Voyager said it has approximately $1.3 billion in crypto assets on its platform, along with claims against Three Arrows and $350 million in cash at the Metropolitan Commercial Bank.

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Reprimand received

Meanwhile, Three Arrows received an official reprimand from MAS for allegedly providing the regulator with “misleading information”. MAS said Three Arrows’ assets were under management at approximately $179 million (SG$250 million).

Last week, a court in the British Virgin Islands ordered Three Arrows into liquidation after it failed to repay debt.

MAS argued that 3AC exceeded its AUM limit from July 2020 to September 2020 and between November 2020 and August 2021. And, Three Arrows allegedly misled MAS by transferring the management of the only fund it managed to an offshore entity in the British Virgin Islands and saying it would cease fund management business in Singapore from May 6.

MAS noted that Three Arrows co-founder Su Zhu is a shareholder in the offshore company.

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Have the stakes of the co-founders changed?

MAS also claimed that Three Arrows failed to report changes to Zhu and his co-founder Kyle Davies’ stakes in the company within the required timeframes. But MAS did not punish Three Arrows for the alleged misdeeds.

Three Arrows sought to protect its US assets by filing under Chapter 15 of US bankruptcy rules.

Bitcoin, altcoins not affected

Bitcoin and altcoin prices do not appear to have been affected by Voyager and Three Arrows issues on Monday, which was a holiday in the United States and other jurisdictions.

Given that many investment markets have been shut down, crypto does not appear to be subject to the macroeconomic forces that have been dictating bitcoin and altcoin price trends of late. Digital coins also appeared to benefit from an increase in crypto investments in Argentina after the country’s economy minister resigned. Confidence in the peso continued to decline.

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