The Voyager Digital lending platform has applied for

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US crypto lending platform Voyager Digital announced on Wednesday that it filed for bankruptcy, becoming another victim of the dramatic fall in prices that shook the cryptocurrency sector, writes Reuters.

Cryptocurrency lenders, such as Voyager, have reported a boom in the COVID-19 pandemic, attracting high-interest depositors with easy access to loans, benefits that are rarely offered by traditional banks. However, the recent collapse of crypto markets – triggered by the fall of two major tokens in May – has affected creditors.

New Jersey-based Celsius froze withdrawals in June and hired advisers for a possible bankruptcy lawsuit. Voyager froze withdrawals this month, as did another creditor, Singapore’s Vauld.

Last week, Voyager said it issued a notice of default to Singapore-based Three Arrows Capital (3AC) because it failed to make payments on a total loan of more than $ 650 million. .

Subsequently, during the same week, 3AC filed for bankruptcy under a provision that allows foreign borrowers to protect US assets, becoming one of the best-known investors affected by the collapse of crypto prices. 3AC is now in liquidation, Reuters announced last week.

“Prolonged volatility and the contagion in the crypto markets in recent months, as well as the non-payment by Three Arrows Capital of a loan, force us to take deliberate and decisive action now,” said Voyager CEO Stephen Ehrlich.

In a bankruptcy filing on Tuesday, Voyager – based in New Jersey but listed in Toronto – estimated that it has more than 100,000 creditors and assets ranging from $ 1 billion to $ 10 billion, as well as debts of the same value.

Last month, Voyager signed an agreement with Alameda Ventures, founded by Sam Bankman-Fried, CEO of the major FTX exchange, for a revolving line of credit. A lawsuit filed in the U.S. Bankruptcy Court in the southern district of New York showed that Alameda was Voyager’s largest creditor, with unsecured loans of $ 75 million.

The specific bankruptcy proceedings that Voyager has entered into put all the issues related to civil litigation on hold and allow companies to prepare recovery plans while remaining operational.

In a message to customers on Twitter, Ehrlich said the process will protect assets and “maximize value for all stakeholders, especially customers.”

Voyager said Wednesday it has more than $ 110 million in cash and cryptographic assets. It intends to pay employees on a regular basis and continue to provide primary benefits and certain programs to customers without interruption.