Crypto lender Voyager Digital has agreed to settle claims against company executives who approved a risky nearly $1 billion loan to failed crypto hedge fund Three Arrows Capital (3AC) after minimal due diligence, a misstep that contributed to Voyager's own bankruptcy, Reuters reported. Voyager said in a Monday court filing that pursuing litigation against chief executive officer Stephen Ehrlich and another executive would not be cost-effective. Instead, Ehrlich will pay $1.125 million in cash to Voyager, and the company will pursue recoveries from director and officers insurance policies worth up to $20 million, according to the filing. Voyager filed for bankruptcy protection in July, citing 3AC's June 2022 default on the loan as a major factor in its insolvency. 3AC began liquidation proceedings in the British Virgin Islands in late June. Voyager had lost significant value during an industry-wide cryptocurrency slump caused by the collapse of the Terra Luna stablecoin in May 2022 and stopped customers from withdrawing their crypto assets shortly before its bankruptcy filing.
