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Voyager Digital reported on July 1 that it has stopped accepting trades, deposits, withdrawals, and loyalty points as of 14:00 EDT. The harsh market circumstances have caused it to become the most recent significant crypto business to suffer.

"This was an extremely tough choice, but we feel it is the correct one given the present market circumstances," said Stephen Ehrlich, CEO of the cryptocurrency lending business.

He continued by saying that the action preserves the platform's value while giving the company more time to "continue exploring strategic possibilities with other interested partners."

Default to Blame 3AC

The business had earlier claimed that on June 29, Three Arrows Capital (commonly known as 3AC) received a notice of default from its subsidiary, Voyager Digital LLC, for failing to make loan payments.

One of the biggest crypto-focused hedge funds in the market, 3AC, located in Singapore, has lent Voyager $15,250 BTC and $350 million USDC.

In a statement, Voyager said it was "currently pursuing all options for recovery against 3AC, including via the British Virgin Islands' court-ordered liquidation procedure."

Moelis & Corporation, The Consello Group, and Kirkland & Ellis LLP have been appointed by the company as financial and legal consultants, respectively. In compliance with Canadian securities laws, Voyager also disclosed a number of revisions to its financial and balance sheet information.

In order to reduce part of its exposure to 3AC, Voyager stated on June 22 that it had entered into a financing arrangement with Alameda Ventures. A "revolver" of $200 million in cash and USDC as well as a loan for 15,000 BTC were included in the "definitive deal" with Alameda.

More than 22 million Voyager common shares, or about 11.56 percent of the outstanding common and variable voting shares, are indirectly owned by Alameda. After the trading suspension notification on Friday, Voyager share (VYGVF) prices fell as much as 40%.

Three Arrows Capital was censured by the Monetary Authority of Singapore (MAS) on June 30 for giving incorrect information and going above the assets under management (AUM) limit.

Voyager Digital now stops users' withdrawals in the midst of the current market turbulence, joining companies like Celsius and CoinFLEX who have already done so.

Crypto Markets are still declining

In the cryptocurrency sector, terrible news continues coming in, which has led to very negative market sentiment. Over the previous 24 hours, the market capitalisation of all cryptocurrencies has declined by another 4%, reaching slightly over $900 billion.

Cryptocurrency markets have dropped 34% this month, or $467 billion, and are now down 70% from their November high levels.

At the time of writing, Ethereum (ETH) had dropped to $1,057 after losing more than 4% of its value while Bitcoin (BTC) was languishing at $19,274.

Positive mood and price movement are unlikely to resurface until after all of this leverage has been eliminated from the crypto markets.

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