The Sinking Of Voyager

Voyager's press release revealed a massive hole in its balance sheet.Approximately 28% of Voyager's assets are in default.Voyager is making whopping losses.Friday was quite a day. The crypto lender BlockFi provisionally agreed a bailout deal with FTX. The hedge fund Three Arrows Capital (3AC), already in compulsory liquidation in its home territory the British Virgin Islands, filed for Chapter 15 bankruptcy protection in the United States. And the crypto broker Voyager (VYGVF) suspended trading and withdrawals.Voyager's press release revealed a massive hole in its balance sheet. Some 58% of its loan book consists of loans to 3AC: And its loan book is nearly 50% of total assets: So approximately 28% of Voyager's assets are in default. And since 3AC now has creditor protection, Voyager must wait for bankruptcy courts to decide how much, if anything, can be recovered. That will take months.But the balance sheet hole doesn't explain why Voyager has suspended US dollar withdrawals. Despite its apparently healthy "cash held for customers" balance, it seems to be dreadfully short of cash. There is something else going on here.As always when something doesn't quite add up, I take a look at the books. In May, only a few days after Terra's collapse, Voyager released its quarterly financial update, dated 31st March. The income statement makes grim reading: Voyager is making whopping losses. Like all crypto companies this year, it h...