August 8, 2022

Beleaguered cryptocurrency lender Voyager Digital has been approved to return some client funds held at the Metropolitan Commercial Bank (MCB) by the judge presiding over the company’s ongoing bankruptcy proceedings in New York, according to several news reports.

The ruling clears the way for Voyager Digital to return about $270 million in frozen customer funds.

Relief for clients

There was some relief in store for Voyager Digital customers as a judge presided over the bankruptcy proceedings that the cryptocurrency lender had provided the court with sufficient grounds to support its claim that its customers should be allowed access to funds offered by the Metropolitan Commercial Bank contract. The decision paves the way for Voyager to return at least some of the cash deposits to its customers.

Voyager Digital transferred the money to a Metropolitan Commercial Bank account when it filed for bankruptcy on July 5th. As soon as the bankruptcy proceedings began, the funds stored in the account were frozen.

Intend to refund clients in full

Stephen Elrich, CEO of Voyager Digital, said in July that the company fully intends to honor its commitment to its users and return customer funds held in a Metropolitan Commercial Bank account once the settlement process is completed and fraud prevented. Following this statement, the company requested the funds held in the account on July 15.

Voyager is in heavy debt of about $10 billion, an amount borrowed from about 100,000 creditors. but, voyager digital It’s not the only company that has faced turbulent waters over the past few months, with other crypto brokerages and lenders, such as Three Arrows Capital. BlockFi and Celsius are in similar situations.

“Higher and better” offers are on the table

The cryptocurrency lender also revealed that it received higher and better bids than the FTX and Alameda exchanges, contrary to the company’s public statements. voyager digital It stated in the second day of the hearing, which took place on Thursday, that it received interest from about 88 stakeholders who were eager to rescue the distressed lender. She added that the company is in discussions with more than 20 stakeholders.

Alameda-FTX Offer

Alameda’s bid and FTX were among the lender’s most well-known bids. Under the terms of the bid, Alameda will buy all of Voyager’s assets and outstanding loans, except for loans to Three Arrows Capital. The company will then liquidate all assets and distribute the funds through the US FTX exchange.

However, Voyager Digital rejected the offer on July 25, with the company stating that it was not “maximizing value” for its customers. It also stated that there were better offers on the table, contrary to the allegedly inaccurate statements made by Alameda and FTX.

Disclaimer: This article is provided for informational purposes only. It is not provided or intended to be used as legal, tax, investment, financial or other advice.

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