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The Sinking of Voyager
- deleted 4y ago[deleted]
- deleted 4y ago[deleted]
- chevman 4y agoJust like we have exponential growth, we need to have exponential implosion! I would argue, more lessons to be learned on the way down :)
- TedDoesntTalk 4y ago> more lessons to be learned on the way down :) Voyager deliberately misled its customers by claiming their assets were FDIC insured. The only lesson to be learned here is that fraud is alive and well. People were genuinely duped, and I hope there is some consequence to Voyager leadership.
- Animats 4y agoThe funds allocated for lending is lent out to borrowers (with a float maintained for withdrawals on the platform). This lets us give interest to our users. The loans to our borrowers are risk free. They are overcollateralised by at least 150%, and are typically repaid in 30 days.[1] This is one of those cases where litigation to "pierce the corporate veil" and go after the parent companies and the company officers individually may be worthwhile. Wikipedia: "In the United States, corporate veil piercing is the most litigated issue in corporate law. Although courts are reluctant to hold an active shareholder liable for actions that are legally the responsibility of the corporation, even if the corporation has a single shareholder, they will often do so if the corporation was markedly noncompliant with corporate formalities, to prevent fraud, or to achieve equity in certain cases of undercapitalization." A case can be made for fraud here, in that the company represented that it was investing money in "risk free" investments while actually loaning money to high risk debtors. Piercing the corporate veil is rare outside of bankruptcy, but not that unusual when bankruptcy is involved. This is a case of undercaptitalization, where someone went into the financial services business without enough money of their own to cover risks. Their headquarters is in Jersey City, NJ. Where there are lawyers who go after corporate fraud routinely.
- TedDoesntTalk 4y ago> Their headquarters is in Jersey City, NJ But where are they incorporated? Delaware ?
- Animats 4y agoThis is the sort of thing where you need good corporate lawyers, and the dollar amounts are big enough to justify them.
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- throwoutway 4y agoIt should be simpler when fiduciary responsibility was violated, correct?
- mightytravels 4y agoSo all what Voyager was is a retail arm of 3AC? That’s just depressing.
- Danieru 4y agoMeanwhile 3AC was a feeder fund for Anchor. Before the collapse I speculated the risk premium on these loan products existed to cash out whales with substandard crypto. Clearly I was wrong; the situation was much worse: everything fed into ponzis.
- seibelj 4y agoI am sorry for every individual who gets hurt and loses money. I genuinely hope they get recourse and their funds restored. I am not sorry for Voyager, 3AC, Celsius, or any firm that has insolvency issues. I do not care if liquidation pushes crypto far lower. I am happy there are no government bailouts and any rescues are by strong private firms at fire-sale prices. The crypto industry will be stronger after such shakeouts ruin the scammers, moronic risk-takers, and shady operators. Retail investors who got burned will not return, and if they do, learned a valuable lesson. I only wish 2008 had a similar outcome rather than subsidized losses and zero pain for the rich and connected. I'm happy markets still work somewhere in this world.
- brians 4y agoCould you point me towards parts of the crypto industry that aren’t scammers, unwise risk-takers, or shady operators?
- seibelj 4y agoI could respond with a long and well-argued comment but this is HN so it would get downvoted to oblivion no matter the content as it is positive towards crypto. Few on this website argue in good faith on this subject and trying to convince someone to change their mind is useless. What I will say is the 2018 bear market was exactly the same and know-it-all commenters predicted mass casualties, Tether destruction, ponzi, and so on and so forth while the industry rose back to new highs.
- Zanfa 4y ago> I could respond with a long and well-argued comment I’ve seen crypto-people try to give some concrete examples, but all of them can usually be done better with boring tech (tickets, supply chains, land deeds) or public-private key signing (certificates, proof of authenticity). It was quite painful how even Marc Andreesen couldn’t give a single example and the guy is plowing billions into the industry. You could power wind turbines with the amount of handwaving that typically surrounds descriptions of usecases for crypto. > What I will say is the 2018 bear market was exactly the same and know-it-all commenters predicted mass casualties, Tether destruction, ponzi, and so on and so forth while the industry rose back to new highs. In 2018 the market penetration of crypto was nothing compared to now. Now there are public companies blasting ads 24/7 on every single channel, so the amount of naive new money may be tapped out for good. And all of the existing “investors” are getting burnt real bad.
- NoMAD76 4y agoVisited link for Voyager (interstellar probe), got to another crypto-ultra-whatever... ohhhh dear
- Akronymus 4y agoYeah, at this point it'd make sense to add "(crypto)" to such submissions.
- pndy 4y agoTags support for submissions like on lobste.rs would be a nice feature to have here
- Akronymus 4y agoThat reminds me of tildes.net. Which I haven't been on in forever. (basically a reddit clone with tags. Along with being invite only.) Maybe I should check out that site again, assuming I can dig up my login info somewhere.
- dwd 4y agoI clicked on the link thinking it was an article related to the time the Australian navy sunk a RAN warship: https://en.wikipedia.org/wiki/Melbourne%E2%80%93Voyager_collision https://en.wikipedia.org/wiki/Melbourne%E2%80%93Voyager_coll... On another occasion the Melbourne sunk the Evans, a US warship.
- drooopy 4y agoI thought that this was going to be about some forgotten episode of Star Trek Voyager :(
- alldayeveryday 4y agoInteresting article. However it still seems unclear to me whether Voyager customers' retail USD deposits are safe or not. It seems predicated upon the question of whether Voyager was placing the funds on their behalf into accounts at Metropolitan Commercial Bank or not - and the article does not provide concrete evidence on this question. Anyone have a different interpretation?
- jeromegv 4y agoIn their balance sheet, it is part of their assets. Perhaps the money is there, perhaps it is not. However the fact is, if they are going the bankruptcy route and have to sell/distribute their existing asset, then this asset is up for grab in the order that people have the right to the asset. This isn't an asset protected for the customers only. So while there might be money left, it doesn't mean I twill end up in the hands of the customers as they are the last one in line to get proceeds back. If really the money was under the customer's name, "on their behalf", then it wouldn't be an asset under the balance sheet. It would not have been theirs.
- dreamcompiler 4y agoSearch for the phrase "I called the FDIC" in the article. EDIT: It's an image. Search for "enterprising Voyager customer" instead.