voyager insurance

US Regulator Inquires Voyager’s FDIC Insurance Claims

Regarding claims that it is FDIC-insured, the Federal Deposit Insurance Corporation (FDIC) is looking into cryptocurrency lender Voyager Digital. The cryptocurrency company previously stated that “all customers’ USD held with Voyager is FDIC insured” thanks to its strategic partnership with Metropolitan Commercial Bank.

The FDIC investigates Voyager

According to Reuters on Thursday, which cited confirmation from an FDIC official, the Federal Deposit Insurance Corporation (FDIC) is investigating Voyager Digital Ltd. (TSE: VOYG) and its promotion of deposit accounts for cryptocurrency transactions.

The FDIC is an independent organization that Congress established to uphold the stability and public trust in the country’s financial system. The deposits of numerous community banks and other financial institutions are governed and insured by it. According to the website of the regulator, “the standard insurance amount is $250,000 per depositor, per insured bank, for each account ownership category.”

Even though it is not an FDIC-insured bank, Voyager claimed to be FDIC-insured through a banking partner. A blog post from the Voyager team from December 2019 stated:

“All USD kept by customers with Voyager is FDIC-guaranteed because of our strategic ties with Metropolitan Commercial Bank, our banking partner.”

The cryptocurrency lender’s official Twitter account also frequently posted about its FDIC protection. Have you heard? One of the tweets reads: The FDIC insures USD owned by Voyager up to $250K. Security for our clients is our top priority. Start expanding your cryptocurrency holdings now.

The cryptocurrency lender has told Twitter users who questioned its FDIC insurance that the USD that customers hold with the business is secure and FDIC-insured.

Following the suspension of trading, deposits, and withdrawals by Voyager last week, Metropolitan Commercial Bank, a bank with a New York state charter and FDIC membership, released a statement addressing FDIC protection for Voyager clients.

For the advantage of Voyager customers, the bank said it “maintains an omnibus account” in dollars. Although Metropolitan Commercial Bank has noted that the FDIC insures funds held by Voyager customers up to $250,000, the bank emphasized:

“Only the failure of Metropolitan Commercial Bank is covered by FDIC insurance coverage.” The demise of Voyager is not covered by the FDIC insurance. “

Voyager said on Wednesday that the company has submitted a Chapter 11 bankruptcy petition. The cryptocurrency lender tweeted on Sunday: “We presently have roughly $1.3 billion in crypto assets on our platform, in addition to claims totaling more than $650 million against Three Arrows Capital.” At Metropolitan Commercial Bank, we also have cash reserves totaling over $350 million.

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