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Funds stranded on the platform of bankrupt cryptocurrency broker Voyager Digital could start returning to creditors in the “next few weeks,” according to Voyager’s committee of creditors.
A May 4 tweet from the Official Committee of Voyager Unsecured Creditors (UCC) stated that the now-defunct cryptocurrency company is in the final stages of bankruptcy liquidation. The UCC is “hopeful” that “initial distributions will begin within the next few weeks.”
4/ Voyager is also finalizing everything internally that is necessary to make distributions to creditors. We are hopeful that initial distributions will begin within the next few weeks.
— Voyager Official Committee of Unsecured Creditors (@VoyagerUCC) May 4, 2023
The UCC update came 10 days after Binance. US abandoned its original deal to buy $1.02 billion of Voyager’s assets, with the cryptocurrency exchange blaming a “hostile and uncertain regulatory climate in the United States” as the reason for the deal’s pullout.
Fortunately, Voyager’s restructuring plan includes a “switchover option” that allows the firm to self-liquidate following Binance’s decision. US exit the deal. This allows the bankrupt broker to distribute cash and cryptocurrency to clients directly through the Voyager platform.
The UCC was dismayed by Binance’s decision. US, saying it would investigate potential claims against the cryptocurrency exchange due to a last-minute change of mind.
1/ Around 2 hours ago, https://t.co/5sjac1H4CW purported to terminate the asset purchase agreement with Voyager. The Committee is incredibly disappointed with this decision and is investigating potential claims against https://t.co/5sjac1H4CW.
— Voyager Official Committee of Unsecured Creditors (@VoyagerUCC) April 25, 2023
It is worth noting that Voyager must now file for liquidation in the US Bankruptcy Court for the Southern District of New York. According to the committee, the parties have 10 days to file any objections to the liquidation proceedings.
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The UCC explained that if no objections are filed within the next 10 days, then Voyager will “go into effect” with the plan.” However, if an objection is filed, the court will hold a hearing to consider the objection before the liquidation plan can be accepted.
Of the 61,300 Voyager customers who voted for the court restructuring plan, 97% voted yes, even though voters believed Binance at the time. US will acquire stuck assets.