Voyager’s Bankruptcy Leaves Gap for Crypto Loan Providers to Fill

How Voyager's App and Loans Became Big Business

Voyager operated as a brokerage and lender, offering clients returns of up to 12% on their cryptocurrency deposits.

The mobile-only platform was available on the Apple App Store and the Google Play Store. While users could trade cryptocurrencies on the platform through the brokerage interface, its functionality was limited when stacked up against some of the best cryptocurrency exchanges.

Loan Defaulting Hedge Funds Leads to Voyager's Downfall

The company earned revenue by issuing large-scale loans to institutional lenders and hedge funds. Interest from these loans funded the lucrative returns promised to clients.

In June 2022, the notorious hedge fund Three Arrows Capital (3AC) defaulted on a $650 million loan, leaving Voyager on the hook.

The collapse of the Terra ecosystem, combined with the broader “crypto winter” and market downturn, deepened the platform’s troubles.

In July, it froze customer accounts, preventing users from trading, depositing, or withdrawing funds. Just days later, the exchange filed for Chapter 11 bankruptcy. Its future hung in the balance for months. The infamous exchange FTX initially won an auction to acquire its assets, but the deal collapsed when FTX itself filed for bankruptcy later in 2022.

Binance U.S. then launched a $1 billion bid to acquire the assets but withdrew in early 2023, citing hostile and uncertain regulatory conditions.

In May 2023, the bankruptcy plan was approved, allowing the exchange to begin initial recovery efforts that returned 35.7% of customer funds. Customers were given a 30-day window in mid-2023 to withdraw their assets.

By August 2023, the mobile app was permanently shut down, leaving users searching for a viable alternative—and we have the perfect exchange.

Start Trading with Nexo and Enjoy Top Tier Benefits

While Nexo provides credit lines like traditional financial institutions, what sets them apart is how their loans work. To secure a loan, clients are not subjected to a credit check, as the loan is secured against their crypto holdings. Users can also repay their loans at their pace.

Users can earn interest from the platform by depositing their digital assets into a savings account with flexible or fixed-term periods. While interest rates can vary based on numerous factors, rates can rise to 14% for flexible savings and 15% for fixed-term savings programs.

The platform also has a crypto card in partnership with Mastercard. Users can spend the fiat value of their crypto without selling them in debit mode or use their crypto as collateral for a line of credit in credit mode.

Why Nexo is A Solid Alternative For Voyager Users

Voyager offered a simple way to access crypto loans. However, its unsecured, leveraged business model meant it was exposed to external factors, which ultimately led to its demise.

Nexo business model offers loans backed against real-time proof of reserve audits. This protects clients from being subjected to risks associated with unsecured loans. This model still delivers competitive rewards while remaining sustainable. Check out the platform for yourself to see if it’ll work for you.