Voyager Digital’s Liquidation Plan: 35% Crypto Deposit Recovery for Customers
Voyager Digital, a crypto lending platform, announced on Wednesday that it will soon begin returning approximately 35% of customers' cryptocurrency deposits as it wraps up operations following an unsuccessful acquisition attempt by Binance.US, another crypto exchange.
In a court hearing in Manhattan, U.S. Bankruptcy Judge Michael Wiles approved Voyager’s liquidation plan, granting the company permission to give back around $1.33 billion worth of crypto assets to its customers. This decision effectively ended Voyager’s efforts to reorganize under Chapter 11 bankruptcy.
According to Voyager’s official creditors’ committee, customers may be able to initiate withdrawals starting from June 1. It should be noted that any further distribution beyond the initial 35% will be contingent upon the outcome of future legal proceedings.
Voyager initially filed for bankruptcy protection in July, citing the volatility in cryptocurrency markets and the default on a significant loan provided to crypto hedge fund Three Arrows Capital (3AC).
Throughout the bankruptcy process, Voyager failed to sell its assets. The first endeavor involved a proposed $1.42 billion sale to FTX, which fell through when FTX experienced a substantial setback in November. Subsequently, Binance.US signed a $1.3 billion offer but ultimately terminated the deal on April 25 due to concerns over a “hostile and uncertain regulatory climate.”
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The prospects of Voyager customers’ recovery significantly hinge on the outcome of litigation with FTX, which is attempting to recoup $445.8 million in loan repayments made to Voyager prior to FTX’s own bankruptcy filing.
Voyager’s court filings suggest that if the company prevails in the FTX litigation, customers can expect their recovery rate to increase to 63.74%.
Regarding the repayment process, Voyager aims to reimburse customers with the same type of cryptocurrency they had in their accounts. However, for deposits held in cryptocurrencies that are not supported for withdrawal on Voyager’s platform and Voyager’s own VGX token, customers will be repaid in the stablecoin USDC instead.
Source: Reuters
Alexander Stefanov
Reporter at CoinsPress
Alex is an experienced finance journalist and a cryptocurrency and blockchain enthusiast. With over five years of experience covering the industry, he deeply understands the complex and constantly evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His passionate approach allows him to break down complex ideas into accessible and insightful content. Follow up on his content to be up to date with the most important trends and topics - stay ahead of the curve with CoinsPress.
