Cryptocurrency Companies Owe Over $50B to Investors and Creditors
A number of organizations involved in the cryptocurrency industry, most notably Celsius Network, Terra, Voyager Capital, and Three Arrows Capital, have seen their prospects deteriorate during the last several months. The combined debt owed to investors and creditors by the four companies is considerably over $50 billion.
The leader of the pack, Terra, is responsible for the loss of $40 billion in investor funds that were caused by the catastrophic fall of its tokens in May. This event led to a tornado of authorities all over the globe to demand tougher regulation on cryptocurrencies, especially stablecoins.
The cryptocurrency lending platform known as Celsius, which ceased all withdrawals one month ago and filed for bankruptcy the day before yesterday, has a hole in its financial sheet of $1.2 billion and has said that it owes its consumers $4.7 billion in total.
Another cryptocurrency business, Voyager Digital, which had just filed for bankruptcy, has over 100,000 creditors and owes them a total of $1.3 billion. Due to the uncharted nature of the actions being undertaken by both firms, they will be subjected to careful scrutiny by legislators, members of the industry, and most importantly, creditors who want to get their money back.
Lastly, the co-founders of Three Arrows Capital, Zhu Su and Kyle Davies, are running from the company’s furious creditors, to whom it owes billions of dollars. An emergency move to freeze the assets of the crypto hedge fund was approved by a judge. The firm’s liquidation manager Teneo was given authority to subpoena Su and Davies of Three Arrows as well.