Bankrupt Voyager secures $484.35M for creditor repayments

Voyager Digital has made substantial progress in repaying creditors after filing for bankruptcy, bringing in $484.35 million through agreements with FTX, Three Arrows Capital (3AC), and insurance claims for the directors and officers. This is a major achievement in the company’s financial revival plan and creditor compensation process.

After filing for bankruptcy, Voyager Digital has made significant strides in repaying its creditors. The company has obtained approximately $484.35 million through agreements with FTX, Three Arrows Capital (3AC), and by making claims on Directors and Officers (D&O) insurance policies.

In their detailed report on distributing recovered assets and settling creditor claims following Voyager Digital’s bankruptcy filing, submitted to the Southern District of New York Bankruptcy Court, it was revealed that approximately $450 million of the recouped funds originated from a settlement with FTX.

Voyager filed for Chapter 11 bankruptcy in July 2022 as the crypto market started to falter.

In October 2023, both the US Commodity Futures Trading Commission (CFTC) and the Federal Trade Commission (FTC) accused Stephen Ehrlich, former CEO of Voyager, of making deceitful statements through separate lawsuits.

Approximately a quarter of the total claims made by Voyager’s creditors is represented by this settlement, including accrued interest. It is expected to be distributed to the creditor group soon.

Besides the FTX deal, Voyager has secured a claim worth around $675 million from their ongoing lawsuit against Three Arrows Capital. Approximately $20.43 million of this sum belongs to Voyager as their share of the initial distribution from Three Arrows Capital.

The administrator anticipates making more payments in the near future, as assets are liquidated and lawsuits are resolved. An agreed-upon settlement from D&O insurance mediation will distribute a minimum of $14.35 million towards repaying Voyager’s debts.

During Voyager’s financial restoration process, the business encounters operational challenges. Approximately 270,000 checks, worth a total of $17 million, are yet to be cashed. The vast majority of these checks have values under $25.

After April 20, any checks issued to Voyager that haven’t been cashed will become invalid and cannot be used.

The Voyager team is currently investigating the fallout from a data security incident. Expert help is being brought in to trace the source and full extent of the breach, which led to the exposure of creditor information.

Starting from May 2023, Voyager’s proposed restructuring plan indicated that customers would initially recoup 35.7% of their claims through cryptocurrency or cash. In November 2023, the crypto exchange reached a settlement with the Federal Trade Commission (FTC), resulting in a monetary relief sum of $1.65 billion.

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2024-04-11 10:49