The US Bankruptcy Court in New York ruled on August 4 that Voyager provided “sufficient basis” to support its claim that customers should get some of their money back.
The trust account held at the Metropolitan Commercial Bank (MCB) contains at least $270 million in cash that the company disclosed when it filed for bankruptcy. The company has now been given the go-ahead to return that money to its customers, which has settled one of the most significant issues it has faced, according to The Wall Street Journal.
Voyager Digital suspended withdrawals in early July due to bad debts that Three Arrows Capital (3AC) had accumulated. The company filed for Chapter 11 bankruptcy on July 5, noting at the time that it had $350 million in cash held in an FBO account (for) clients at MCB.
postpone for some
Like many beleaguered crypto brokers and lenders, Voyager faced a bank-managed situation as customers scrambled to withdraw their funds amid the crashing cryptocurrency market.
The company requested the release of cash held in the bank, but stated that the estimated $1.3 billion in crypto assets on the platform belonged to a bankruptcy estate to be shared by all creditors.
Voyager aims to close a sale by September and has already rejected offers from FTX chief and crypto billionaire Sam Bankman-Fried. In late July, SBF attacked the company, claiming that it still owns 75% of its assets and that clients have not yet been compensated.
Two days later, the Federal Reserve and the Federal Deposit Insurance Corporation (FDIC) accused Voyager of misleading customers with false claims that it was covered by FDIC insurance.
The approval of this week’s release of funds will provide some reprieve to those who have seen assets frozen by central companies during the ongoing crypto winter.
Sideways crypto markets
Cryptocurrency markets are still range bound with very little movement in either direction in the last 24 hours. Total capitalization remains at $1.1 trillion, and major assets are consolidated at current levels.
Bitcoin is flat on the day at a touch of over $23,000, while Ethereum is trading at $1,664, where it was yesterday.
The only cryptocurrency in the top 10 to make a move is Binance Coin, with BNB up 4.2% to $313 at the time of writing. The company just announced a partnership with Mastercard to provide prepaid crypto cards in Argentina.
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