Crypto | High Seas ahead as Creditors pursue 15,250 BTC

The string of high-profile Bitcoin bailouts continues.

In the latest breaking headline, the news of Voyager Digital's eye-watering US$661 million exposure to Three Arrows Capital (3AC) alludes to the roaring wave of liquidations that approaches.

According to their website:

Three Arrows Capital is a hedge fund established in 2012 and focused on providing superior risk-adjusted returns, founded by Su Zhu and Kyle Davies.

Cryptocurrency broker Voyager Digital recently announced that its subsidiary would likely issue a default notice to 3AC if the hedge fund does not settle its outstanding debts. The broker's total exposure to 3AC is estimated to be 15,250 bitcoin, approximately USD 300 million, and $350 million of the USDC stablecoin. 

Voyager is now pursuing legal discussions to recover both:

1. A $25 million USDC loan repayment, which is due by June 24, and

2. The entire amount is to be repaid by June 27 

Both claims are still unpaid at this point in time.

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Hope, in the Aftermath?

In exploring remedies to settle loans with creditors, the latest reports indicate that Three Arrows Capital has contemplated avenues.

Measures considered are reported to include the sale of assets and a possible bailout from another firm. 

It is also unsurprising to see Voyager become more aggressive with its requests after signing an agreement with Alameda Ventures Ltd for a revolving line of credit to meet the liquidity needs of its customers. 

That same financial lifeline was offered to BlockFi this week as cryptocurrency exchange FTX chief executive Sam Bankman-Fried (SBF) extended a US$250 million loan to cover the crypto lender's exposure. This latest bailout adds to an additional US$485 million loan to Voyager, effectively pulling the broker back from the brink.

Uncle Sam's generosity seems to have helped investors grab a breath of fresh air as confidence regained in the markets.

However, both the magnanimous SBF and Q know that Crypto Winter may last much longer than the market can remain solvent.

Q's Conclusion continues in tomorrow's episode of Charting with Griff.

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Signing off this report ahead of the weekend's trading video…

Take a look at the light technical analysis on the BTC/USD daily chart.

Bitcoin vs. US Dollar, $BTC - Daily (D1)

Observe the price action that still appears slightly shaky as markets head into the month's end. 

A double bottom on the .786 fib retrace level supported by healthy volume is a promising sign that the market may have found a temporary footing. Recognising that confirmation of a bullish reversal has not been produced is crucial.

Thus, for safety's sake, a guarded view remains until the Bitcoin prices can assertively flip the daily 20 exponential moving average (D1 20 EMA, GREEN) into support at local horizontal resistance (RED).

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Bitcoin vs. US Dollar, $BTC - 4 Hour (H4)

Upon closer examination, the makings of a potential sloped inverse head and shoulders or descending broadening wedge can be seen forming.

While both chart formations are generally perceived as bullish, tomorrow's trading video will scrutinise this structure and break down the possibilities for what lies ahead for cryptocurrency markets.

See you again for the next update.

- q

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