Voyager customers get access to withdraw funds
Bankrupt crypto lender Voyager is gearing up to allow its customers to withdraw their funds, almost a year after filing for Chapter 11 bankruptcy. Starting from next week, Voyager app will undergo an update to display the available withdrawal amount for each customer.
According to the bankruptcy plan administrator, Paul Hage, in a court filing on June 14, the withdrawal period would start between June 20 and July 5. Starting this Thursday, Voyager customers will be granted the opportunity to complete necessary forms and get a glimpse of the initial withdrawal amount they can expect.
Having received court approval on May 17, the bankruptcy plan will allow customers to initially recover 35.72% of their claims. The ruling allows the company to proceed with returning approximately $1.33 billion worth of crypto assets to its customers. Additionally, it marks the conclusion of Voyager’s efforts to reorganize under Chapter 11 bankruptcy.
This news comes as a relief to investors who have had their funds held on various platforms since the company’s bankruptcy. The crypto lender initiates the process of winding down its operations as acquisition deals by FTX US and, more recently, Binance US, have fallen through.
Voyager plans to reimburse its customers by returning the same type of cryptocurrency that was held in their accounts, dismissing speculation suggesting that it would consider an alternative payment method. Specifically, major coins, including Aave (AAVE), Ethereum (ETH), Bitcoin Cash (BCH), and 65 others, will not be liquidated but rather returned to customers in digital form.
However, for deposits consisting of unsupported cryptocurrencies that cannot be withdrawn from Voyager’s platform, as well as for Voyager’s proprietary VGX token, customers will be repaid using the stablecoin USDC. This approach ensures that customers receive value equivalent to their original holdings, even for assets that cannot be directly withdrawn.
Meanwhile, the ultimate recovery prospects for Voyager customers are closely tied to the resolution of the litigation involving FTX, as well as the amount of recovery that FTX offers its own creditors.
FTX’s failed trading arm, Alameda Research, asked a court to claw back $445 million from Voyager Digital, which it said SBF’s empire paid to the crypto lender before collapsing into bankruptcy.
Alameda Research seeks to recover those loan payments from the troubled digital asset manager since they were made close to FTX’s bankruptcy filing. Under certain circumstances, federal laws consider such payments eligible to be ‘recoverable’ and thus could be used to repay FTX’s own creditors.
According to court filings, if Voyager achieves a successful outcome in the FTX litigation, customers can expect a recovery rate of approximately 63.74%.