Crypto lender Voyager Digital has experienced quite a tumultuous journey over the past few months, culminating in Wednesday’s approval of its liquidation plan by US Bankruptcy Judge Michael Wiles. This comes after multiple failed buyout attempts and the announcement that Voyager’s customers will soon recover 35% of their cryptocurrency deposits.
Under the approved liquidation plan, Voyager will return approximately $1.33 billion in crypto assets to its customers, thereby concluding its efforts to reorganize under Chapter 11. The Voyager Official Committee of Unsecured Creditors has also expressed their intent to work with the firm in order to implement the plan as quickly as possible, potentially as early as this Friday.
Voyager had initially filed for bankruptcy in July 2022, partly due to its exposure to cryptocurrency hedge fund Three Arrows Capital. Since the filing, the company has sought support from prominent names in the crypto industry, but with little success.
The now-bankrupt FTX secured the approval of a US Bankruptcy Court to acquire Voyager’s assets, but this deal ultimately collapsed. Binance then attempted to take over, valuing Voyager at $1 billion, only to withdraw from the deal later. This withdrawal came in response to the “hostile” regulatory climate in the US, as the US Securities and Exchange Commission and New York’s financial regulator tried to intervene and block the deal.
Binance’s withdrawal left Voyager to opt for the Chapter 11 plan, which would “allow for direct distribution of cash and crypto to customers.” As a result, the firm is now intent on moving swiftly to “return value to customers via direct distributions” and plans to release further information regarding the next steps customers need to take in the coming days.
The situation with Voyager Digital serves as a testament to the turbulent and unpredictable nature of the cryptocurrency market, as well as the struggles faced by companies navigating a highly regulated industry. While Voyager’s customers may finally receive a portion of their lost investments, the firm’s journey has highlighted the importance of understanding the complex economic and regulatory landscape.
Ultimately, the story of Voyager Digital offers a cautionary tale about the challenges faced by companies operating within the crypto space, with both the market’s inherent volatility and the industry’s unstable regulatory environment serving as significant obstacles to success. Only time will tell if other companies can fare better and navigate these complex waters more effectively.
Source: Cryptonews
