Alameda Research Owes Bankrupt Voyager $377M

Table of Contents

• Borrower, Lender, And Shareholder
• FTX Rescuing Ventures In Trouble

According to Voyager Digital’s recent bankruptcy filings, crypto trading firm Alameda Research had heavily borrowed funds from the lending platform. 

In a bizarre twist of fate, one of Voyager Digital’s borrowers came to its rescue. Founded by crypto billionaire Sam Bankman-Fried, Alameda Research is a trading platform that is acting both as a creditor and a borrower for Voyager. The company, which already owes Voyager Digital a sum of $377 million, extended a $500 million line of credit to the crypto broker last month. 

Borrower, Lender, And Shareholder

Crypto brokerage firm Voyager Digital has just filed for bankruptcy under Chapter 11 of the United States Bankruptcy Code in New York City. In its filing, the company has claimed a whopping $600 million defaulted loan to liquidated crypto hedge-fund, Three Arrows Capital (3AC). However, the documents submitted by the company to the court today have revealed that Alameda Research is also on the list of its major debtors. The bankruptcy filings reveal that it owes Voyager $377 million at an interest rate of 1% o 5%. This makes Alameda Research the second-largest borrower after the insolvent 3AC. 

However, Alameda Research is playing other roles in the Voyager Digital drama. The firm had extended a credit line worth about $485 million in mid-June to Voyager to help it stabilize its troubles. However, the latter had withdrawn only $75 million from this credit line, which is the maximum amount allowed in a 30-day period. Furthermore, with more than a 9% stake, Alameda is also one of Voyager’s largest shareholders. 

FTX Rescuing Ventures In Trouble

Bankman-Fried, who is also the CEO of crypto exchange FTX, believes that Voyager’s bankruptcy filing could be an unfortunate turn of events for Alameda. However, he has acknowledged that quick investments in distressed assets could result in the occasional loss. 

He commented, 

“If your strategy for trying to extend a lifeline to companies in need results in you never doing it to a company that files for bankruptcy, then you probably weren’t doing your job.”

FTX’s newly launched FTX Venture has set aside $2 billion to bail out ventures lacking in liquidity. 

The chain of destruction was the result of a domino effect that started with the devastating crash of the Terra (LUNA) token in June. The debacle completely unstabilized 3AC, which had a close relationship and a great deal of exposure to the stablecoin, resulting in its liquidation. This led to 3AC defaulting on its $670 million loan from Voyager, which was then compelled to seek reorganization through Chapter 11 of the Bankruptcy code. 

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.