By
Mayowa Adebajo
April 11th, 2024
Voyager Digital has had a very rough year, and this is reflected in both the performance of its stock and token prices.
The shares of crypto services platform Voyager Digital Holdings Ltd (TSE: VOYG) is seeing a very massive downturn, in the aftermath of its earlier announcement that it was suspending its core activities including deposits and withdrawals for its users. At the time of writing, the shares of Voyager Digital had plunged by 42.24% to CAD 0.34, this is one of its major daily falls in the past month and a very unhealthy way to start the second half of the year.
Voyager Digital has had a very rough year, and this is reflected in both the performance of its stock and token prices. While investors are generally cautious to place bets considering the broader bearish sentiment that has engulfed the market, the sell-offs in the price of Voyager Digital stem from the negative press about the firm per its connections to highly troubled crypto firms.
Through the Voyager platform, users can buy, sell, and earn rewards on crypto-assets all coming as a commission-free trading offer. Voyager Digital as well as other platforms like Robinhood Markets Inc (NASDAQ: HOOD) that offer commission-free trading are very popular in the digital currency world.
Voyager Digital in Distress
The plunge in the prices of digital currencies has placed Voyager in a very unpleasant position, one that has affected its bottom line across the board. While it first started facing liquidity issues earlier in June, its woes became compounded when its debtor, Three Arrows Capital (3AC), one of the biggest hedge funds in the space defaulted in repaying its $650 million loans.
Voyager Digital issued a notice of default to 3AC last month as it unveiled that it was working with the company’s lawyers in order to draw up a plan that can help in recovering the funds. There is no idea whether this will be possible as a court in the British Virgin Islands ordered the liquidation of 3AC, a move that was followed by the filing of Chapter 15 bankruptcy by the embattled hedge fund to protect its holdings in the United States.
It is unclear how deep Voyager’s finances are affected at this time, but with the prices of crypto assets still on a rapid decline, it can be predicted that the firm is not out of the woods yet. As part of its efforts to get back on its feet, Voyager Digital received a $200 million capital injection in the form of a credit facility from Alameda Ventures.
While Voyager’s shares are trading at a massive deviation from its All-Time High (ATH), the token VGX is not faring any better as it has dropped 91.90% in the Year-to-Date period. While trading at a price of $0.2467, down 18.57% in the past week, the token now has a market capitalization of $68.51 million at the time of writing.
This token valuation notably exceeds the $65.65 million Canadian Dollars that the company’s equity is worth at this time.