A federal judge orders Voyager Digital to pay $1.65 billion
A federal judge has approved an order requiring crypto lending firm Voyager Digital and its affiliates to pay $1.65 billion in monetary relief to the United States Federal Trade Commission (FTC). This comes after a settlement between Voyager and the FTC was announced in October. As part of the agreement, Voyager will be prohibited from marketing or providing products or services related to digital assets.
The impact on bankruptcy proceedings
Judge Gregory Woods stated that the order will not significantly affect Voyager’s bankruptcy court proceedings. In July 2022, Voyager filed for Chapter 11 protection and disclosed liabilities ranging from $1 billion to $10 billion. The court previously approved a plan that allowed Voyager users to receive 35.72% of their claims.
Requirements and cooperation
Under the settlement, parties associated with Voyager must cooperate with FTC officials and provide testimony at hearings, trials, and discovery. Additionally, Voyager will be monitored by the commission for compliance with the proceedings.
Similar cases
In October, both the U.S. Commodity Futures Trading Commission and the FTC filed lawsuits against former Voyager CEO Stephen Ehrlich, accusing him of making misleading statements about customer funds. Another crypto lending firm, Celsius, was ordered by the FTC to pay $4.7 billion in fees in July for alleged misappropriation of user assets and misleading investors.
Hot Take: The consequences of regulatory actions on crypto firms
The recent order for Voyager Digital to pay $1.65 billion highlights the increasing scrutiny and consequences faced by crypto lending firms for alleged misconduct. Regulatory bodies like the FTC are actively pursuing cases against companies that violate consumer protection laws or mislead investors. These actions demonstrate the importance of regulatory compliance and transparency in the cryptocurrency industry. As the industry continues to evolve, it is crucial for crypto firms to prioritize legal and ethical practices to maintain trust and avoid substantial financial penalties.
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