The Canadian-based crypto exchange filed for bankruptcy earlier this week.
The Federal Deposit Insurance Corporation (FDIC) is taking a look at claims by crypto broker Voyager that its customer accounts were protected by that U.S. agency in the event of a company collapse, the Wall Street Journal reported Thursday.
Voyager filed for bankruptcy protection earlier this week, revealing that it had somewhere between $1 billion and $10 billion in both assets and liabilities.
The FDIC – a federal regulator tasked with overseeing bank stability in the U.S. – protects customers from losing their funds in the event of a bank collapse, insuring up to $250,000 per account. This insurance, however, usually only applies to an actual bank failure, not upon failure of the bank’s client, i.e. ,Voyager’s collapse wouldn’t necessarily trigger an FDIC backstop.
In its previous advertising, though, Voyager appeared to be saying that its own customers would be protected by the FDIC, pointing to its accounts at New York-based Metropolitan Commercial Bank. For its part, this week Metropolitan put up a statement on its website refuting the Voyager claim.
“FDIC insurance coverage is available only to protect against the failure of Metropolitan Commercial Bank,” the statement said. “FDIC insurance does not protect against the failure of Voyager, any act or omission of Voyager or its employees, or the loss in value of cryptocurrency or other assets.”
Voyager held an omnibus account at the bank for U.S. dollars, the statement added.
Voyager, in announcing its bankruptcy filing, valued current holdings at Metropolitan to be about $350 million (it has another $110 million in cash on hand, as well as over $1 billion in crypto). According to sources familiar with the matter, reported the WSJ, Voyager’s customer deposits at Metropolitan would be segregated from other Voyager assets in a bankruptcy and protected from creditors.
An FDIC spokesperson did not return a request for comment by press time.