In response to financial issues brought on by the fall of bitcoin hedge fund Three Arrows Capital, Voyager filed for chapter 11 bankruptcy on July 4.
Customers of the bankrupt cryptocurrency lender Voyager Digital may be entitled to 72% of the value of their accounts under a tentative arrangement with FTX US, according to court documents, as reported by Cointelegraph.
The tentative sale won’t be final, however, until it has been approved by Voyager’s creditors and the bankruptcy payout plan has been approved by the US bankruptcy judge, who stated during the court hearing that “If the plan falls apart, there is no part of this agreement that survives,” according to Cointelegraph.
Cointelegraph said that should any recommendations be made that result in a better outcome for creditors, Voyager is allowed to end the contract with FTX using a clause known as a “fiduciary out.”
In order to guarantee creditors get the best deal possible, the provision, which enables firms to consider greater bids until the sale is complete, is typically inserted in bankruptcy proceedings.
After the exchange won the auction on September 27 at a valuation of around $1.4 billion after a two-week process, Voyager had already predicted that its users would ultimately transfer to the FTX platform. The restoration of around 72% of the value of other account holders’ accounts, which have been frozen since July 1, is also possible under the suggested plan from FTX, according to Cointelegraph.
In response to financial issues brought on by the fall of bitcoin hedge fund Three Arrows Capital, Voyager filed for chapter 11 bankruptcy on July 4.
The bid comprises extra consideration of at least $111 million and the fair market value of FTX US’s crypto assets as of an unannounced date, which as of September 26 is estimated to be $1.3 billion.
