Mark Cuban is in trouble.
The billionaire contractor has for several days been subjected to a stream of criticism in connection with a partnership with a cryptography company. In fact, Cuban, an evangelist from the crypto industry that he has invested in, had signed an agreement last October linking his NBA team, the Dallas Mavericks, to crypto lender Voyager Digital.
The contract, signed on October 28, is for five years and has a mission to promote cryptocurrencies by making coins more accessible through educational and digital programs.
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$ 100 in rewards when you open an account
As part of the partnership, Voyager Dallas Mavericks fans promised a $ 100 reward for trading crypto on Voyager for a limited time if they deposited $ 100 and only traded $ 10. The offer had been so successful that Voyager was forced to create a waiting list.
“We are going to find new ways to introduce Mavs fans to cryptocurrency and help them understand it,” a Cuban said at the time during a news conference with Voyager CEO Steve. Honestly. “You know there’s a lot of hype, there’s a lot of talk, but most people do not understand the basics behind it. We will try to bring that level of education to our common fans and customers.
The problem is that less than nine months later, Voyager Digital filed for bankruptcy. And at the moment it’s hard to know if its customers will get their money back. In fact, the company is one of the security victims of the crisis of confidence that has wiped out more than $ 2 trillion from the crypto market since all-time highs were reached in November.
Voyager is a cryptocurrency trading platform. The company also offers loans and wagering services, which are a kind of reward for holding certain coins. It was his lending business that got him out of trouble: Voyager appears to have lent its customers’ funds to the crypto hedge fund Three Arrows Capital, also known as 3AC. Last month, however, this fund defaulted on a $ 667 million loan that Voyager had given it. Three Arrows Capital has been forced by a court in the British Virgin Islands to go into liquidation. Faced with this disaster, Voyager suspended deposits, withdrawals and loyalty rewards on its platform.
“Clients with crypto in their account (s) benefit in exchange for a combination of the crypto in their account (s), revenue from the 3AC recovery, the company’s common stock and Voyager tokens,” Ehrlich wrote on Twitter. July 6th.
Traveling “is a great way to learn”
On October 28, shares in Voyager Digital closed at $ 14.21. In its final session this week, before being delisted at the company’s request, the Voyager stock traded at 25 cents a share.
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“You spend your money, so always be careful,” a Cuban told a news conference in October when asked about the last thing you need to know before investing in the crypto sector. “But the other one chose, listen, there are investments, things like Shiba Inu and Dogecoin, they are not investments. But Voyager … it’s a great way to learn, and it’s something you can do on your smartphone. You can start getting into this and save your money and it’s just a chance once in a lifetime.
Shiba Inu and Dogecoin are two identical coins created as a joke.
Cuban’s proposal and this partnership are now coming back to haunt him, as many retail investors claim to have invested in Voyager or passed through the platform for their first crypto investments after the partnership with the Dallas Mavericks. These investors experience their anger on social networks.
“So we’ve been tough on @mcuban twice?” posted a Twitter user.
“@Mcuban @costplusdrugs Do not trust Cuban. I lost everything in his ‘partnership’ with Voyager, ”complained another user. “He says he is not in it for the money and only charges 10-15% after costs. That’s 9 digits for every billion. He’s not someone who “is not in it for the money!” I’m devastated by him.
“@mcuban I’m sure you grant that you offered me to use @investvoyager for my crypto exchange. 👍” complained another user.
“@mcuban is full of mats 👀,” said another.
Cuban, who has a social media presence and has retweeted posts from users praising his efforts to reduce drug costs, has yet to address Voyager’s bankruptcy.
A request for comment on Twitter from the Dallas Mavericks has so far gone unanswered.
“In equities and crypto, you’ll see companies backed by cheap, easy money – but not good business prospects – disappear,” a Cuban said in an interview with Fortune last month. “Come [Warren] Buffett says, “When the tide goes out, you can see who’s swimming naked.”