The Federal Deposit Insurance Corporation (FDIC) is investigating crypto lender Voyager Digital over claims it is insured by the FDIC. The crypto firm previously explained that through its strategic relationship with Metropolitan Commercial Bank, “all customer USD held with Voyager is FDIC insured.”
Voyager Probed 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 variety of community banks and other financial institutions. “The standard insurance amount is $250,000 per depositor, per insured bank, for each category of account ownership,” the regulator’s website details.
While crypto lender Voyager is not an FDIC-insured bank, it claimed to be FDIC-insured through a banking partner. The Voyager team wrote in a December 2019 blog post:
Through our strategic relationship with our banking partner, Metropolitan Commercial Bank, all customer USDs held with Voyager are FDIC insured.
The crypto lender’s official Twitter account also tweeted multiple times, boasting about the company’s FDIC insurance. One of the tweets reads: “Have you heard? USD held with Voyager is FDIC insured up to $250K. The safety of our customers is our top priority. Start growing your crypto portfolio today.”
In some cases, the crypto lender assured Twitter users who doubted its FDIC insurance that customers’ USD held with the company is safe and insured by the FDIC.
When Voyager suspended trading, deposits and withdrawals last week, Metropolitan Commercial Bank, a New York-chartered 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’s customers. While 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 to protect against the failure of Metropolitan Commercial Bank. FDIC insurance does not protect against Voyager failure.
On Wednesday, Voyager said it has filed for Chapter 11 bankruptcy. The crypto lender wrote on Sunday: “We currently have approximately $1.3 billion in crypto assets on our platform, plus claims against Three Arrows Capital of 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 it is insured by the FDIC? Let us know in the comments section below.
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