Voyager suspends trading, deposits, withdrawals, and loyalty rewards • Hacker News Board

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#11

Post by iskander » Fri, Jul 01, 2022, 9:05 PM UTC

alexjplant wrote: post #7

ansible wrote: post #4

I sometimes wonder if I'm the only one who just wants a bank to be a bank. I've been with the same relatively small regional bank for 30 years. I have a checking account, savings account and that's it. They've been stable this entire time, and I've never worried my money was going to disappear. As another sign of being an old man, I'm old enough to remember the phrase "as safe as money in the bank". You see, when I w…

Aren't retail and investment banking separate spaces? Aren't depository accounts insured to the tune of a quarter of a million dollars by the FDIC? Isn't Voyager a crypto exchange? I tend to keep my money in local credit unions as well, but I'm struggling to understand how this discussion is germane to Voyager's actions here. EDIT: See https://www.investvoyager.com/blog/voyager-is-now-fdic-insur...

https://en.wikipedia.org/wiki/Gramm%E2%80%93Leach%E2%80%93Bl...

>the Financial Services Modernization Act of 1999...repealed part of the Glass–Steagall Act of 1933, removing barriers in the market among banking companies, securities companies, and insurance companies that prohibited any one institution from acting as any combination of an investment bank, a commercial bank, and an insurance company

FDIC insurance ends up being the main guarantee of safety, especially in the modern era of 0% reserve requirements.

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#12

Post by armchairhacker » Fri, Jul 01, 2022, 9:05 PM UTC

I saw this on their site:

> FDIC INSURED ON USD $250,000

> You USD is held by our banking partner, Metropolitan Commercial Bank, which is FDIC insured, so the cash you hold with Voyager is protected.

So does that mean anyone with less than $250k is guaranteed their money? Is there any legal backing?

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#13

Post by ValentineC » Fri, Jul 01, 2022, 9:08 PM UTC

armchairhacker wrote: post #12

I saw this on their site: > FDIC INSURED ON USD $250,000 > You USD is held by our banking partner, Metropolitan Commercial Bank, which is FDIC insured, so the cash you hold with Voyager is protected. So does that mean anyone with less than $250k is guaranteed their money? Is there any legal backing?

I think the keyword here is "cash".

Other forms of assets, namely crypto, aren't protected by FDIC insurance.

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#14

Post by xur17 » Fri, Jul 01, 2022, 9:09 PM UTC

armchairhacker wrote: post #12

I saw this on their site: > FDIC INSURED ON USD $250,000 > You USD is held by our banking partner, Metropolitan Commercial Bank, which is FDIC insured, so the cash you hold with Voyager is protected. So does that mean anyone with less than $250k is guaranteed their money? Is there any legal backing?

If a user has $250k or less in USD assets on the platform I believe it does.

For most of these sites, users convert deposits into stablecoins (USDC, etc) since they can typically earn interest on this, and this is not covered under FDIC.

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#15

Post by tomjakubowski » Fri, Jul 01, 2022, 9:09 PM UTC

barnbuilder wrote: post #10

sdfhdhjdw3 wrote: post #2

I guess everyone's strategy in the crypto space is put everything you have on bitcoin and hope it goes up. It's a really good strategy, when it works.

The people getting wiped out by the collapse of Voyager, Celsius, etc. were not putting their money on bitcoin. They were giving it to a custodian who thought they could beat bitcoin by investing in altcoins (or lending to those who do so). This is definitely not "everyone's strategy"; plenty of us bitcoiners have been warning against this sort of irresponsible activity for a long time.

What's irresponsible about that compared to just parking it in BTC?

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#16

Post by NovemberWhiskey » Fri, Jul 01, 2022, 9:09 PM UTC

iskander wrote: post #11

alexjplant wrote: post #7

Earlier quoted context omitted.

Aren't retail and investment banking separate spaces? Aren't depository accounts insured to the tune of a quarter of a million dollars by the FDIC? Isn't Voyager a crypto exchange? I tend to keep my money in local credit unions as well, but I'm struggling to understand how this discussion is germane to Voyager's actions here. EDIT: See https://www.investvoyager.com/blog/voyager-is-now-fdic-insur...

https://en.wikipedia.org/wiki/Gramm%E2%80%93Leach%E2%80%93Bl... >the Financial Services Modernization Act of 1999...repealed part of the Glass–Steagall Act of 1933, removing barriers in the market among banking companies, securities companies, and insurance companies that prohibited any one institution from acting as any combination of an investment bank, a commercial bank, and an insurance company FDIC insurance end…

>especially in the modern era of 0% reserve requirements.

Total red herring; reserve requirements went away but they were irrelevant because banks were holding massively in excess of the required reserves in any case.

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#17

Post by JumpCrisscross » Fri, Jul 01, 2022, 9:09 PM UTC

iskander wrote: post #11

alexjplant wrote: post #7

Earlier quoted context omitted.

Aren't retail and investment banking separate spaces? Aren't depository accounts insured to the tune of a quarter of a million dollars by the FDIC? Isn't Voyager a crypto exchange? I tend to keep my money in local credit unions as well, but I'm struggling to understand how this discussion is germane to Voyager's actions here. EDIT: See https://www.investvoyager.com/blog/voyager-is-now-fdic-insur...

https://en.wikipedia.org/wiki/Gramm%E2%80%93Leach%E2%80%93Bl... >the Financial Services Modernization Act of 1999...repealed part of the Glass–Steagall Act of 1933, removing barriers in the market among banking companies, securities companies, and insurance companies that prohibited any one institution from acting as any combination of an investment bank, a commercial bank, and an insurance company FDIC insurance end…

> especially in the modern era of 0% reserve requirements

They’ve been replaced with capital requirements, which make a lot more sense in modern finance than reserve requirements.

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#18

Post by xur17 » Fri, Jul 01, 2022, 9:10 PM UTC

barnbuilder wrote: post #10

sdfhdhjdw3 wrote: post #2

I guess everyone's strategy in the crypto space is put everything you have on bitcoin and hope it goes up. It's a really good strategy, when it works.

The people getting wiped out by the collapse of Voyager, Celsius, etc. were not putting their money on bitcoin. They were giving it to a custodian who thought they could beat bitcoin by investing in altcoins (or lending to those who do so). This is definitely not "everyone's strategy"; plenty of us bitcoiners have been warning against this sort of irresponsible activity for a long time.

Exactly. And if you had half an ounce of sense, you would have withdrawn your deposits from these platforms when UST and then Celsius collapsed.

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#19

Post by JumpCrisscross » Fri, Jul 01, 2022, 9:10 PM UTC

armchairhacker wrote: post #12

I saw this on their site: > FDIC INSURED ON USD $250,000 > You USD is held by our banking partner, Metropolitan Commercial Bank, which is FDIC insured, so the cash you hold with Voyager is protected. So does that mean anyone with less than $250k is guaranteed their money? Is there any legal backing?

> does that mean anyone with less than $250k is guaranteed their money?

I’ve noticed a lot of crypto companies being sneaky with this. What that means is if Metropolitan Commercial Bank goes under, Voyager’s cash is protected. It does nothing to protect cash you’ve entrusted to Voyager if Voyager goes under.

Re: Voyager suspends trading, deposits, withdrawals, and loyalty rewards

#20

Post by reaperducer » Fri, Jul 01, 2022, 9:10 PM UTC

ansible wrote: post #4

I sometimes wonder if I'm the only one who just wants a bank to be a bank. I've been with the same relatively small regional bank for 30 years. I have a checking account, savings account and that's it. They've been stable this entire time, and I've never worried my money was going to disappear. As another sign of being an old man, I'm old enough to remember the phrase "as safe as money in the bank". You see, when I w…

You probably also remember when bank buildings were designed to look like historic buildings, in order to foster a sense of trust and permanence.

Today, banks look like coffee shops and low-rent cell phone stores.