Traveling Guilty of Misrepresenting Your Insurance? The Fed is attacking hard

Traveling lower than the ground? – Especially because of $670 million in loans what he owes Three Arrows Capitalthe trading app Travel Digital also found itself in bankruptcy. As society struggles to recover, the Federal Reserve (Fed) comes in person to kick him in the kneecaps. Voyager is thus attacked on its declarations concerning his deposit insurance.

Voyager ordered to stop his “misleading” statements

This early July 2022, the cryptocurrency exchange platform Travel Digital had no choice but to put himself under the protection of US bankruptcy law. If the company refuses to throw in the towel, and tries restructuring rather than filing for final bankruptcy, a bad news may make it even more difficult for him.

Indeed, it is no less than the Federal Reserve American, together with the Federal Deposit Insurance Corporation (FDIC), which come to put additional spokes in the wheels already saturated with wood of Voyager.

In a most official letter, revealed on July 28, the two organizations demand no less than a “cease and desist” to the crypto-company:

“We hereby instruct Voyager to cease and desist from making false and misleading statements regarding its deposit insurance status (…) and to take immediate action to correct its prior statements. »

Excerpt from Fed and FDIC letter to Voyager.

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Fed and FDIC assure it: no deposit guarantee for customers

The “false and misleading statements” in question are detailed a little later in the letter. We can thus read that the two American organizations accuse Traveling to lie about the facts of:

  • assert oneself as insured with the FDIC;
  • than its customers would benefit from insurance the FDIC for all deposited funds;
  • that the FDIC would assure customers against bankruptcy travel.

The Fed and the FDIC explain that these false declarations have mislead customers who placed their funds with Voyager. It would indeed only be its banking partner, the Metropolitan Bankwhich would be insured with the FDIC.

“Voyager maintains a deposit account for the benefit of its customers at the Metropolitan Commercial Bank (…) whose deposits are insured by the FDIC. However, Voyager is not itself FDIC-insured, and therefore clients who invest through its cryptocurrency platform will not receive insurance coverage in the event of Voyager’s bankruptcy. »

Even if Voyager tries to straighten its head, in particular by allowing itself to refuse the too hasty (interested?) offer of FTXthings look more than complicated. Anyway, on the side loss of trustworthy extra for its customers, the Fed and the FDIC did not go out of their way.

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