According to recent reports, crypto investors can withdraw funds from Voyager Digital as early as June 20. One year after shutting everything down under Chapter 11 bankruptcy, Voyager Digital is ready to reopen.
According to Paul R. Hage, an administrator who oversaw Voyager’s bankruptcy proceedings, bankrupt cryptocurrency project Voyager Digital plans to reopen its application, allowing customers to withdraw their funds.
Reopening Plan
Paul highlighted that the app would be updated by June 15 to reflect the available withdrawal amounts and estimated timelines. The withdrawal period is scheduled from June 20 to July 5. The move comes after a court-approved plan was put into motion, aiming to give customers access to a portion of their funds.
Under the court-approved plan, customers are expected to receive approximately 35.72% of their funds within 30 days of initiating a withdrawal request. The exact duration will vary based on different aspects, including withdrawal demands, security and anti-fraud protocols, and technical limits, among other factors.
Notably, Voyager is still pursuing additional assets to distribute to its creditors. The bankruptcy filing also revealed that Voyager is owed $650 million by Three Arrows Capital, which has also filed for bankruptcy.
As a result, the initial withdrawal limit has been set at over 35% to account for the pending debt. Voyager’s focus will shift towards recovering these additional assets for distribution to creditors once the initial phase is complete.
Furthermore, the resolution of Alameda Research’s priority claim, which could potentially return $445 million of customer funds to creditors, is not expected until at least September 2023.
Voyager, originally a lending project, faced financial difficulties following the collapse of the 3AC fund. The project encountered a shortage of funds due to the fund’s refusal to pay a $650 million debt. Despite initial attempts to sell Voyager back to FTX for $1.4 billion in October 2022, the deal fell through due to FTX’s own bankruptcy.
Following this, Binance expressed interest in acquiring Voyager for $1 billion. However, regulatory authorities in the United States, including the Securities and Exchange Commission and the Department of Justice, intervened and blocked the deal as part of their legal actions against Binance.
Bittrex.US and BlockFi to Allow Withdrawals
Bittrex.US, the American branch of Bittrex, previously announced that it would enable customers to withdraw their funds, starting from June 15. The news came after Bittrex.US got approval from the District of Delaware.
In early May, the US branch of Bittrex filed for bankruptcy after previously ceasing operations due to an ongoing lawsuit initiated by the Securities and Exchange Commission (SEC).
On June 13, Judge Brendan L. Shannon approved Bittrex.US to let its customers withdraw fiat and crypto assets. However, the decision is limited to specific assets. The recent developments outlined do not impact Bittrex Global, a cryptocurrency exchange operating outside of the United States.
Like Bittrex.US, BlockFi also stated its plan to complete the necessary testing procedures, allowing certain customers to receive their funds back during the summer. The crypto lender faced a temporary withdrawal halt following the crash of the FTX exchange in November 2022.
BlockFi is currently engaged in the process of seeking repayment of outstanding amounts exceeding $1.5 billion from its trading partners, including FTX and Alameda Research.
The situation of BlocFi is more challenging since its loans are held by debtors involved in the ongoing bankruptcy proceedings. These are Three Arrows Capital, FTX, and Silicon Valley Bank.
Despite the challenging circumstances, these recent actions demonstrate a commitment to addressing investors’ concerns and working towards a fair resolution. These latest updates offer hope to investors with difficulty accessing their funds on the troubled platform.
However, the crypto markets still look weak. With falling Bitcoin prices, and a difficult macro environment, crypto companies may have more pain coming.
