The bankruptcy plan of cryptocurrency broker Voyager was approved by the United States Bankruptcy Court for the Southern District of New York on May 17, according to a Reuters news story. Judge Michael Wiles’ order approving the proceeding was published by the court a day earlier.
The so-called third bankruptcy plan was proposed on May 5, after Binance.US backed out on April 25 of its plans to buy $1 billion worth of Voyager assets. That deal had overcome resistance from the US government before Binance.US’s last-minute pullback. Voyager will now be liquidated, that is, it will distribute its assets among its creditors.
Why are lawyers & executives for #voyager not forfeiting their pay if they didn’t do their jobs, especially when many are working other #crypto bankruptcy cases?
In what other industry can you fail at literally everything & still come out with millions?
Make it make sense. https://t.co/BQEu0J9h9H
— VGX Heroes (@VGX_Heroes) May 15, 2023
In September, prior to the Binance.US deal, FTX.US had won an auction for the Voyager assets, with a bid of $1.4 billion, but the sale fell through when FTX tanked. The sale of FTX would have allowed creditors to receive 72% of the value of their accounts. FTX sued Voyager for $445.8 million in January, alleging that loan repayments it made in 2022 are recoverable because they occurred immediately before FTX’s bankruptcy.
Voyager said on its website that customers could now expect to receive 35.72% of their claims initially, either in crypto via the Voyager app or in cash after 30 days. According to Voyager, it had $1.33 billion in recovery assets as of May 8, of which $629.8 million was available for initial recovery, on claims of $1.8 billion.
Customers with crypto in their account(s) will receive in exchange a combination of the crypto in their account(s), proceeds from the 3AC recovery, common shares in the newly reorganized Company, and Voyager tokens.
— Stephen Ehrlich (@Ehrls15) July 6, 2022
The amount of the initial recovery from creditors could increase if FTX/Alameda Research’s claim for preferential recovery is unsuccessful. Voyager retains $445 million to cover that claim. In addition, Voyager can still recover funds from the bankrupt Three Arrows Capital. Voyager issued a default notice to Three Arrows on a loan of 15,250 Bitcoin (BTC) and 350 million USD Coin (USDC) in late June. Those assets were worth $655 million then and approximately $768 million at press time.
Voyager filed for bankruptcy on July 5.
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