Crypto lender Voyager Digital Ltd. is insolvent but has succeeded in drawing enough interest from potential buyers to begin an auction. The auction is planned on September 13, 2022, in the New York offices of Moelis & Co., Voyager's bank. This information was shared via a notice filed in the bankruptcy court recently. A court hearing to approve the results will be held on September 29.
There is a need for auction only because Voyager
has received more than one acceptable bid for its assets, and none of the bids
were the best. The deadline for submission of bids ended on September 6.
This is probably good news for Voyager
customers who are still locked out of their accounts. If Voyager is sold at a
high price, it might mean better recoveries for customers.
Though Sam Bankman-Fried's FTX and Alameda publicly
disclosed a joint bid for Voyager in July, Voyager didn't seem enthusiastic
about it and called it a "low-ball" offer. In the first week of
August, a court document suggested that eighty-eight parties had contacted
Voyager, and twenty-two were in active talks with the company.
One of those interested parties could be Binance. Another
party is FTX, whose first offer was rejected and is probably trying to make a
new one.
The bankruptcy is Voyager Digital Holdings
Inc., 22-10943. It is filed with U.S. Bankruptcy Court for the Southern
District of New York (Manhattan).
Voyager also talked about the auction in a
series of tweets that were published on September 7 and shared widely. In the
first tweet, the company wrote, "We want to let you know that multiple
bids were submitted as part of the company's restructuring process."
It added that it would "share more
information about the winning bidder" and the implications of the auction
for customers after the process is concluded later this month.
The trouble with the company became highly
evident about two months ago, on July 1. On this date, the company froze
withdrawals. In August, things changed, and the company got permission to
reopen the withdrawals. At that time, the company shared its plans to reopen
withdrawals with a daily limit of $100,000. It is not clear yet whether the company
managed to follow through on those plans or not.
The upcoming auction should help boost the
restructuring plan of Voyager and might help it return the funds to its
customers.
Voyager is already working to return some money
to its customers. On August 5, the New York bankruptcy court that is handling
the case approved a proposal to return $270 million to the affected customers
of the company. $1 billion of the remaining funds of the platform will be
distributed through the bankruptcy process.
Users have been sent emails that list the types
and amounts of crypto in their Voyager accounts. If users disagree with their
holdings' record, they can submit a claim till October 3. Voyager has declined
to comment on the matter till the time of publication. Know more about Voyager here.
Sources:
https://www.bloomberg.com/news/articles/2022-09-07/bankrupt-crypto-lender-voyager-digital-heads-to-auction-block
https://cryptobriefing.com/voyager-digital-will-auction-assets-next-week/
https://decrypt.co/109162/troubled-crypto-broker-voyager-digital-auction-off-assets-next-week