The prospect of getting lost funds back on the bankrupt crypto platform of Voyager Digital will become a reality soon — with the process of bankruptcy liquidation set to begin within the next few weeks.
The process was made possible after the U.S. federal government and Voyager Digital Management reached an agreement to proceed with the firm’s $1 billion asset sale to Binance.US.
UCC Liquidation Plan Moves Forward
The agreement was recently shared by the Voyager Official Committee of Unsecured Creditors (UCC) on Wednesday (April 19). According to the UCC, the resolution allows the liquidation plan to “move forward and go effective shortly.”
Unfortunately, Binance.US backed out of its agreement to buy the assets at the last-minute due to “the hostile and uncertain regulatory climate in the United States.” The decision has prompted the UCC to investigate potential claims against the cryptocurrency exchange for pulling out of the deal.
Voyager Customers Vote to Self-Liquidate: Plan Submission to Court
The good news is that Voyager already has an alternate plan in the form of a “toggle option” that would allow the firm to pursue self-liquidation and distribute cash and crypto to customers directly on the Voyager platform. The plan was backed by 97% of the 61,300 Voyager customers who voted on the court’s restructuring plan.
Voyager will now have to submit its liquidation procedures to the U.S. Bankruptcy Court for the Southern District of New York. However, any objections to the liquidation plan must be filed within 10 days. If no objections are made, then Voyager “will go ‘effective’ with the plan.”
Reimbursement of Creditors Awaits U.S. Bankruptcy Court Decision
While Voyager’s creditors are hopeful of getting their funds back soon, the situation could have been avoided had U.S. regulatory bodies been more proactive. The agency’s delay in approving the asset sale, coupled with the “hostile and uncertain” regulatory climate has resulted in a drawn-out wait for the firm’s creditors.
All eyes are now on the U.S. Bankruptcy Court for the Southern District of New York, who will ultimately decide if Voyager can proceed with the liquidation and finally reimburse its creditors. Hopefully, the journey to find closure will end soon.
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