FTX US Deal with Voyager Offers 72% Funds Recovery

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FTX US Deal with Voyager Offers 72% Funds Recovery

<p class="MsoNormal">According to court documents from this week, clients of the bankrupt crypto lender, <a href="https://www.financemagnates.com/tag/voyager/">Voyager Digital</a> might have a chance to recover some of their funds. Under a preliminary deal with FTX US, a <a href="https://www.financemagnates.com/terms/c/cryptocurrency-exchange/" target="_blank" id="601e2e5f-0c28-4253-9ad4-5e6b251ba2fa_1" class="terms__main-term">cryptocurrency exchange</a> regulated in the United States, customers may be able to obtain over 70% of their accounts' initial value. </p><p class="MsoNormal">However, the preliminary deal would not be finalized until Voyager's creditors express their approval, Michal Wiles, the United States bankruptcy judge, <a href="https://cases.stretto.com/public/x193/11753/PLEADINGS/1175310192280000000017.pdf">said</a> during a court hearing. "There's no part of this agreement that survives" if the tentative sale falls.</p><p class="MsoNormal">According to current arrangements, FTX US would pay out all priority claims in full, allowing the rest of the customers to recover more than 70% of their holdings. The value of accounts maintained by the bankrupt crypto lender has been frozen since July 1.</p><p class="MsoNormal">Almost Four Months of Voyager's Bankruptcy Case</p><p class="MsoNormal">The problems of Voyager began four months ago when, due to liquidity issues, it was forced to file for Chapter 11 bankruptcy on July 4. The <a href="https://www.financemagnates.com/terms/b/bankruptcy/" target="_blank" id="41b3ef0d-d805-441d-8443-121890264e94_4" class="terms__secondary-term">bankruptcy</a> followed the earlier default of Three Arrows capital, a cryptocurrency hedge fund.</p><p class="MsoNormal">Although <a href="https://www.financemagnates.com/tag/ftx/">FTX US</a> won a bid to acquire Voyager Digital's crypto assets, <a href="https://www.financemagnates.com/cryptocurrency/ftx-us-wins-bid-to-acquire-voyager-digitals-crypto-assets/">the deal valued at $1.4 billion is still in the preliminary phase</a>. Thanks to a clause named "fiduciary out," Voyager still has a chance to cancel current agreements if any company other than FTX would present an offering with a better outcome for current creditors. It is often practiced in such cases and allows firms to look for higher bidders before the finalization of the sale. </p><p class="MsoNormal">However, if the deal is finalized as it currently stands, then Voyager customers will be able to transfer to the FTX US platform. New York-Based bankrupt crypto lender had over 3.5 million users (according to March 2021 data) and 1.19 million funded accounts.</p>

This article was written by Damian Chmiel at www.financemagnates.com.

Source: FTX US Deal with Voyager Offers 72% Funds Recovery