The crypto lender was caught up in the 3AC collapse. 3AC had a loan of 15,250 BTC and $350 million USDC. Voyager says it’s ‚pursuing all available remedies for recovery‘ but 3AC is in bankruptcy so that’s going to be a long wait.

„This was a tremendously difficult decision, but we believe it is the right one given current market conditions,“ said Stephen Ehrlich, Chief Executive Officer of Voyager. „This decision gives us additional 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.“

The company hired Moelis & Company and The Consello Group as financial advisors, and Kirkland & Ellis LLP as legal advisors. 

Moelis specializes in M&A and restructurings.

The market wasn’t expecting much from Voyager. The stock isn’t trading today because of a holiday in Canada but it’s been a precipitous fall since before the 3AC collapse.

The company entered into a definitive agreement with Alameda for a US$200 million cash and USDC revolver and a 15,000 BTC revolver on June 17.

On June 14, it said:

Voyager differentiates itself through a straightforward, low-risk
approach to lending and asset management by working with a select group
of reputable counterparties, which are all vetted through extensive due
diligence by its Risk Committee.It’s tough for crypto to find any kind of a bottom until we get all the bad news. Stuff like this makes crypto investors want to pull their funds.

This article was written by Adam Button at www.forexlive.com.

I could tie together a narrative around rates, Fed hikes and whatnot but I’m going to shrug here and put this on flows around the turn of the calendar.

I don’t know if that was European money scrambling for dollars or something else. But it ended abruptly after the European close.

Directionally, some of it makes sense with the market significantly shifting the terminal top of Fed funds down to 3.33% from +4% a couple weeks ago.

This article was written by Adam Button at www.forexlive.com.

The market is navigating different outcomes and in the simplest terms, here’s how it shapes up.

1) High inflation with ongoing growth and Fed hikes above 4%

This is the scenario the market grappled with for most of the year and the results speak for themselves. It was the worst H1 for the S&P 500 since 1970 and the worst for the Nasdaq ever.

2) A recession but inflation under control

The word ‚recession‘ never sounds good to investors but I’d argue that done right, this is the better scenario. As the market has shifted its focus to recession, borrowing costs have come down and a terminal rate of 3.25-3.50% in Fed funds is priced in, coming down to 2.75% about 8 month later.

Unfortunately, markets have gotten drunk on cheap money for far too long and are hopelessly addicted now. Everything is leveraged. If rates top out and we can kick the can down the road on popping the bond bubble, then there’s scope for a ‚recession rally‘ as bizarre as that sounds.

The third scenario

The nightmare scenario is stagflation, where we get a recession and inflation doesn’t fall. That might be possible if the world continues to be short of commodities, or loses faith in central banks. I think we priced in a chance of this in the past few weeks but given how quickly consumer sentiment and industrial orders are declining, along with commodities, this has grown more remote.

Overall though, I don’t see a ‚recession‘ scenario as that bad, especially since I think the hit to the jobs market will be modest.

This article was written by Adam Button at www.forexlive.com.