Voyager Digital: The Broker That Bet It All on 3AC

On 1 July 2022, Voyager Digital froze its customers' accounts. Four days later, on 5 July, the company filed for Chapter 11 bankruptcy in New York, with the law firm Kirkland & Ellis as its counsel. Around $1.3 billion of customers' crypto was stuck on the platform, along with more than $350 million in cash. Most of the hole came from a single loan to a single hedge fund.

Voyager was the respectable face of crypto in 2021. It was a broker, the crypto equivalent of a share-dealing app, that let ordinary people buy bitcoin and other coins on their phones and paid them interest of up to 12 per cent a year for leaving the coins on the platform. Its parent company was listed on the Toronto Stock Exchange. Its chief executive, Stephen Ehrlich, who had previously run the professional trading arm of the online broker E*Trade, was a regular on financial television. In October 2021 it signed a five-year sponsorship deal with the Dallas Mavericks basketball team, whose owner, Mark Cuban, appeared beside Ehrlich to promote it.

The interest had to come from somewhere. Voyager earned it by lending its customers' coins to large trading firms.

One loan, one fund

The biggest borrower was Three Arrows Capital (3AC), a Singapore hedge fund run by Su Zhu and Kyle Davies that had grown huge by betting with borrowed money that crypto prices would keep climbing. Voyager lent it 15,250 bitcoin and 350 million USDC. USDC is a stablecoin, a digital token designed to stay worth one US dollar. At the time the loan was called in, the package was worth more than $650 million, and it was unsecured: 3AC had put up nothing that Voyager could seize if it failed to pay.

In May 2022 the TerraUSD stablecoin and its sister coin LUNA collapsed, wiping out tens of billions of dollars in days. 3AC had money in both, and prices across the market fell with them. By mid-June the fund could not meet calls from its lenders. Voyager asked for a $25 million partial repayment by 24 June and did not get it. On 27 June it served 3AC a notice of default. Within days a court in the British Virgin Islands ordered 3AC into liquidation.

Voyager had drawn $75 million from an emergency credit line from Alameda Research, Sam Bankman-Fried's trading firm, but it was not enough. When customers rushed to withdraw, Voyager shut the doors.

The FDIC claim

What made the collapse worse was what customers had been told. Voyager's website, app and social media said, in various forms, that customers' cash was protected by the Federal Deposit Insurance Corporation (FDIC), the US agency that guarantees ordinary bank deposits up to $250,000.

That was only true in a narrow sense. Customer dollars sat in a pooled account at Metropolitan Commercial Bank, a New York bank, and FDIC insurance would have protected them only if that bank failed. It did nothing if Voyager failed, and it never covered crypto at all. On 28 July 2022 the FDIC and the Federal Reserve sent Voyager a joint letter demanding that it stop making "false and misleading" statements about deposit insurance. The cash at Metropolitan Commercial Bank turned out to be held in trust for customers, and a bankruptcy judge allowed about $270 million of it to be returned in August 2022. The crypto was a different matter.

Two buyers, both gone

The bankruptcy turned into an auction. In September 2022 FTX US, the American arm of Bankman-Fried's exchange, won with a bid valued at about $1.4 billion. In November FTX itself collapsed in one of the largest frauds in US history, and the deal died with it. In December 2022 Binance.US, the American affiliate of the world's largest crypto exchange, signed a roughly $1 billion agreement to take over Voyager's accounts, paying a $10 million deposit. In April 2023, under pressure from US regulators, Binance.US walked away.

With no buyer left, Voyager liquidated itself. Its plan was confirmed in March 2023, and from June 2023 customers received a first payout worth about 35.72 per cent of their claims, about $604 million in total. FTX's estate then sued Voyager to claw back $445 million that Alameda had repaid on its loans shortly before FTX failed. The two sides settled in 2024, freeing about $450 million plus interest. That money funded a second payout, by cheque only, starting on 31 July 2024: about $589 million, bringing eligible customers to roughly 70 per cent of their allowed claims, according to the plan administrator, Michael Wyse.

The executives and the endorsers

In October 2023 the Federal Trade Commission (FTC) and the Commodity Futures Trading Commission (CFTC) both sued Ehrlich, accusing him of misleading customers about the safety of their money. Voyager itself agreed to a $1.65 billion FTC judgment, suspended so its assets could go to customers, and a permanent ban on handling consumers' money. Ehrlich fought on. In June 2025 he and his wife, Francine Ehrlich, agreed to pay $2.8 million to settle the FTC case, and he accepted a permanent ban on marketing or selling products used to trade crypto. On 15 September 2025 a New York federal court entered a CFTC consent order requiring him to pay $750,000 to Voyager customers through the bankruptcy and banning him from CFTC registration for three years. He settled without admitting or denying the allegations. No criminal charges have been brought against him.

Customers also sued the celebrities. A Florida class action filed in August 2022 targeted Cuban and the Mavericks, alongside other promoters including the American football player Rob Gronkowski. Gronkowski and two other defendants settled for $2.4 million in 2024. On 30 December 2025 Judge Roy Altman dismissed the claims against Cuban and the Mavericks because Florida courts lacked jurisdiction over them, without ruling on whether they did anything wrong. The investors have appealed to the Eleventh Circuit.

Still collecting

Voyager's estate is now a debt collector. It holds an agreed claim of about $675 million against 3AC's liquidators and had received about $20.43 million in April 2024 and about $19 million in July 2024, with more expected over several years. It secured $14.35 million from a settlement with former directors' and officers' insurers, and more than $24 million from 207 people and firms that had pulled money out in the 90 days before the bankruptcy. It is suing Metropolitan Commercial Bank in a 53-count complaint, alleging the bank's name and FDIC coverage lent Voyager false credibility, and it is countersuing Binance.US for fraud and breach of contract over the abandoned purchase. That trial is likely to start in 2027.

In its February 2026 report, the plan administrator said a further round of payments was expected later in 2026. More than three years after the doors closed, every dollar customers get back now comes from somebody else's bankruptcy or somebody else's lawsuit.