Voyager Digital, the U.S.-based crypto firm that offers broking services, has filed for bankruptcy.
The company was a model for easy access to loans not commonly offered by traditional banks and advertised high-interest rates appealing to most investors. The opposite is also true: when the major crypto firms suffer financial setbacks or get hit with additional regulars then its business also suffers (a lot).
Celsius Networks froze withdrawals in June, followed not long after by Vauld based in Singapore. Voyager froze withdrawals too in July on the hunch of some blowback.
Three Arrows Capital was informed as well recently that Voyager has defaulted on its crypto loan of more than $650 million.
In the past 12 months alone, Voyager has become the sponsoring partner of:
• The NWSL (National Women’s Soccer League),
• the Dallas Mavericks in the NBA, and
• the Oakland Athletics in MLB.
Its athlete ambassadors include Rob Gronkowski, Tracy McGrady, Marshall Faulk, and Victor Oladipo too.
The NWSL revealed last December a partnership covering several years with Voyager that would provide crypto-funded accounts to its players. The premise of NWSL’s alliance with Voyager has been to compensate its players partly in cryptocurrency, deposited over the Voyager app. Furthermore, education around crypto was being provided to support maturation and the long-term growth of their individual portfolios. A Voyager ‘ambassador’ would be dedicated to each of NWSL’s teams to develop content, work with its players on managing the accounts themselves, and make educational appearances of various kinds.
New discussions are said to be playing out internally within NWSL to anticipate the likely negative impact of Voyager’s bankruptcy filing.
Voyager had been viewed as an appealing entity not only for its emergency in the world of crypto but also for its creative deal structures:
1. Paying one Bitcoin to the Athletics for a full-season suite ticket package in April 2021. Rumor has it a single Bitcoin at that time was valued at $60,000 but has since dropped to around $20,000.
2. An international partnership was struck with the Mavericks in October 2021 to enhance the presence of both organizations through naming rights.
3. Gronkowski revealed his intention to be an outspoken proponent, followed soon thereafter by McGrady and Faulk as advisors/consultants beginning in 2020, attracting Nascar driver Landon Cassill over a two-year commitment at the end of 2021, and more recently Oladipo’s endorsement in May.
It will be fascinating to see going forward whether the notion of consummating alliances, sponsorships, or other partnership deals with industries potentially viewed as at-risk or unproven to some in the public eye like crypto will enter the broader discussion.