The Federal Deposit Insurance Corporation (FDIC) is investigating crypto lender Voyager Digital for claims it is insured by the FDIC. The crypto firm previously explained that through its strategic relationship with Metropolitan Commercial Bank, “all customer dollars held with Voyager are FDIC insured.”
Voyager investigated by the FDIC
The Federal Deposit Insurance Corporation (FDIC) is investigating Voyager Digital Ltd. (TSE: VOYG ) and its marketing of deposit accounts for cryptocurrency purchases, Reuters reported on Thursday, citing confirmation from an FDIC official.
The FDIC is an independent agency created by Congress to maintain stability and public confidence in the nation’s financial system. It regulates and insures the deposits of a number of public banks and other financial institutions. “The standard insurance amount is US$250,000 per depositor, per insured bank, for each category of account ownership,” the regulator’s website said in detail.
Although crypto lender Voyager is not an FDIC insured bank, it claims to be FDIC insured through a bank partner. The Voyager team wrote in a December 2019 blog post:
Through our strategic relationship with our banking partner, Metropolitan Commercial Bank, all customer dollars held with Voyager are FDIC insured.
The crypto lender’s official Twitter account also tweeted numerous times boasting about the company’s FDIC insurance. One of the tweets read: “Have you heard? USD held with Voyager are FDIC insured up to $250K. The security of our customers is our top priority. Start growing your crypto portfolio today.”
On several occasions, the crypto lender assured Twitter users who doubted its FDIC insurance that customers’ USD held with the company was safe and FDIC insured.
When Voyager suspended trading, deposits and withdrawals last week, Metropolitan Commercial Bank, a New York-licensed bank and member FDIC, issued a statement regarding the FDIC coverage available to Voyager customers.
The bank explained that it “maintains an omnibus account” in US dollars for the benefit of Voyager customers. Noting that Voyager customer funds held by Metropolitan Commercial Bank are FDIC insured up to $250,000, the bank noted:
FDIC insurance coverage is available only for Metropolitan Commercial Bank bankruptcy protection. FDIC insurance does not protect against Voyager damage.
On Wednesday, Voyager said it had filed for Chapter 11 bankruptcy. The crypto lender tweeted on Sunday: “We currently have approximately $1.3 billion in crypto assets on our platform, plus claims against Three Arrows Capital for more than $650 million. We also have over $350 million in cash at Metropolitan Commercial Bank.
What do you think about the FDIC investigating Voyager over claims that it is FDIC insured? Let us know in the comments section below.
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