Voyager Digital Files for Chapter 11, Seeks to Maximize
Value for All Stakeholders
Voyager Digital, a US-based cryptocurrency platform, said that it voluntarily filed petitions for protection under Chapter 11 of the United States Bankruptcy Code in order to carry out its reorganization plan and "maximize value for all stakeholders."
Chapter 11 generally allows for restructuring, which typically involves a corporation or partnership. A chapter 11 debtor often offers a plan of reorganization to maintain its company and pay creditors over time.
According to Voyager's restructuring plan, clients who have cryptocurrency in their account(s) would get a mix of the cryptocurrency in their account(s), money recovered from Three Arrows Capital (3AC), common shares in the newly restructured firm, and Voyager tokens in exchange. Users who have USD deposits in their accounts will be able to access their monies following the completion of a reconciliation and fraud prevention procedure with Metropolitan Commercial Bank, they added.
In addition to more than 350 million dollars in cash stored in the Metropolitan Commercial Bank account designated for the benefit of customers, the corporation asserts that it also has more than 110 million dollars in cash and cryptocurrency on hand. Along with claims of more than USD 650 million against 3AC, Voyager also claimed to have almost USD 1.3 billion worth of crypto assets on its platform. According to the report, Voyager sent 3AC a notice of default for failing to make the necessary payments on its previously revealed loan of BTC 15,250 and USDC 350 million.
Voyager Digital said last week that it is "temporarily" halting trading, deposits, withdrawals, and loyalty awards.
This choice extends our time to explore strategic options with multiple interested parties while retaining the worth of the Voyager platform that we have jointly developed. In that statement, Ehrlich was quoted as adding, "We will give more information as necessary."
Additionally as reported, the company has a multi-million dollar credit line agreement with Alameda Ventures, a quantitative trading firm and the parent company of the FTX exchange, and has exposure to the troubled cryptocurrency fund Three Arrows Capital totaling BTC 15,250 (USD 307) and USDC 350 million.