A judge has ruled that Voyager Digital can repay customers with USD 270 million MCB holdings
Wall Street Journal reports that the Bankruptcy Court in New York, where the company’s case is being heard, approved the move
As reported, Judge Michael Wiles said Voyager had provided “sufficient basis” to support its claim that its customers should be allowed to use funds held in a custodial account at the Metropolitan Commercial Bank (MCB).
However, the company’s cryptoasset holdings still raise more questions. The bankruptcy filings of Voyager show that the company has over 100,000 creditors. According to reports, the company holds more than USD 110m in cash and crypto, and more than USD 350m in the For Benefit of Customers account with MCB. Voyager also said it has approximately USD 1.3bn of cryptoassets on its platform, plus claims against Three Arrows Capital (3AC) of more than USD 650m. As reported, Voyager issued a notice of default to 3AC for failure to make the required payments on its previously disclosed loan of BTC 15,250 and USDC 350m.
While the news of a payout from the MCB fund will be welcome to beleaguered Voyager customers, the court is still yet to rule on the fate of the funds still frozen on the Voyager platform.
Per Bloomberg, an attorney representing Voyager also told the court that the lender had already received “multiple bids for its assets in excess of an earlier offer” from the crypto exchange FTX and Alameda Research. The latter is a quantitative crypto trading firm that was founded by the FTX CEO Samuel Bankman-Fried.
The attorney, Joshua Sussberg of the legal firm Kirkland & Ellis, claimed that FTX’s bid to buy Voyager’s crypto holdings for cash at market value – while also offering Voyager customers the option to receive their claims provided they open FTX wallets – had been rejected by Voyager.
The FTX offer was dismissed last week as a “low-ball liquidation bid dressed up as a white knight rescue,” with Sussberg telling the court stating that “of the offers received by Voyager so far,” this was “actually the lowest” to have been tabled.
While Sussberg refused to give further details of the rival bids, the lawyer did claim that these offers would let customers recover much more than USD 0.30 for each dollar they had invested with Voyager.