Court Approval: A Major Step for Voyager Digital
On March 7, Voyager Digital, the bankrupt cryptocurrency lender, clinched a significant victory in court, getting the nod from United States Bankruptcy Judge Michael Wiles to sell its assets exceeding $1 billion to Binance.US. This decision follows an intense four-day courtroom showdown involving Voyager and the U.S. Securities and Exchange Commission (SEC), with Wiles concluding that the transaction should go ahead.
Judge Wiles: A Firm Stance on Regulatory Concerns
In a decision that may have sent shivers down the spines of regulatory bodies, Judge Wiles stated, “I cannot put the entire case into indeterminate deep freeze while regulators figure out whether they believe there are problems with the transaction and plan.” His ruling means affected Voyager customers can expect repayment tokens, allowing them to recoup approximately 73% of their lost funds.
The SEC’s Response: Potential for Appeal
Despite Judge Wiles’ ruling, Peter M. Aronoff from the Department of Justice hinted that an appeal might be on the table. The ongoing tussle between Voyager and regulatory agencies highlights the murky waters cryptocurrency laws often navigate. Meanwhile, last week, a resounding 97% of Voyager’s account holders expressed support for the Binance.US restructuring plan, indicating strong backing for Judge Wiles’ decision.
What’s Next for Voyager? Sale or Liquidation?
In the coming weeks, Voyager will weigh its options: seal the deal with Binance.US or pursue liquidation independently. The decision hinges on the company’s assessment of the potential risks connected to ongoing investigations involving Binance.US and federal authorities. Brian Tichenor, Voyager’s lead investment banker, pointed out that should the restructuring plan come to fruition, customers could receive about $100 million more compared to liquidation.
The Ripple Effects: Customer Payouts and Token Value
However, the road ahead isn’t entirely smooth. The payouts for Voyager customers will also be swayed by a bankruptcy court dispute with Alameda Research, a sibling company of the collapsed FTX, which is pushing for repayment of loans made to Voyager. To cover potential losses, Voyager has earmarked $445 million from its funds. Unsurprisingly, all this news has sparked a flurry of activity around Voyager’s token, VGX, which rose 32.9% from $0.37 to $0.50, before stabilizing at $0.46 shortly after the announcement.
