Exciting News for Voyager Digital: Recovery of $484.35 Million from Settlements
Voyager Digital has recently announced a significant development in its financial recovery journey. The company has successfully recovered $484.35 million from settlements with key entities, including FTX, Three Arrows Capital (3AC), and Directors and Officers (D&O) insurance. This update marks a major milestone in Voyager’s efforts to allocate assets to creditors following its financial decline. Let’s delve deeper into the details of these settlements and what they mean for the future of Voyager Digital.
FTX Settlement and Major Recoveries
One of the most substantial portions of the recovered funds, totaling approximately $450 million, resulted from a settlement with FTX. This agreement, inclusive of interest, accounts for around 25% of Voyager’s creditors’ original claims. The company has plans to distribute this amount in the near future, providing much-needed relief to its creditors.
- The FTX debtors have agreed to forfeit their rights to the $5 million deposit held in escrow from Voyager’s bankruptcy sale process, with these funds being released to the Wind-Down Debtor’s estate.
- Additionally, the FTX debtors and the Wind-Down Debtor have waived and released all claims against each other, including any previously submitted proofs of claim. This agreement includes the dismissal of the pending FTX case.
Furthermore, Voyager disclosed that it has obtained a claim of approximately $675 million from its ongoing litigation with Three Arrows Capital (3AC). Out of this total, $20.43 million represents Voyager’s share of the initial distribution from 3AC. The company’s plan administrator foresees additional payments as the litigation progresses and assets are sold off.
In addition to these settlements, Voyager has made significant progress through D&O insurance mediation, securing at least $14.35 million to benefit its creditors, further supporting its recovery efforts.
Operational Challenges and Progress
Despite the positive developments, Voyager is still facing operational challenges that need to be addressed promptly. These challenges include dealing with uncashed checks, as approximately 270,000 checks totaling $17 million remain outstanding. The majority of these checks, around 187,000, are for amounts less than $25.
- To tackle this issue, Voyager has set a deadline of April 20, 2024, after which all outstanding checks will be considered unclaimed and canceled.
Furthermore, Voyager is also grappling with the aftermath of an FTX data breach, which has added complexity to its bankruptcy proceedings. An investigation is currently underway to determine the source and impact of the breach, which compromised creditor information.
Voyager initially filed for Chapter 11 bankruptcy in July 2022 following significant events in the cryptocurrency market, including the collapse of the Terra ecosystem in May. By May 2023, a restructuring plan proposed that Voyager customers could recover 35.7% of their claims in either cryptocurrency or cash. In November 2023, the crypto exchange reached a settlement with the FTC, agreeing to provide $1.65 billion in monetary relief.
Hot Take: Looking Ahead for Voyager Digital
In conclusion, Voyager Digital’s recent announcement of recovering $484.35 million from settlements signifies a crucial step forward in its financial recovery journey. Despite facing operational challenges and navigating through complex legal proceedings, Voyager remains committed to allocating assets to creditors and moving towards a brighter future. As the company continues to make progress and overcome obstacles, stakeholders can look forward to witnessing further developments and positive outcomes in the coming months.
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