Voyager Digital is liquidating its assets after two failed purchase agreements

Voyager Digital is liquidating its assets after two failed purchase agreements

Voyager Digital plans to self-liquidate its assets and cease operations after failing to secure purchase agreements with Binance and FTX.US.

The planned FTX Voyager acquisition failed due to the exchange's abrupt bankruptcy and the subsequent arrest of its boss Sam Bankman-Fried. However, the collapse of the deal with the American arm of crypto giant Binance was seen as a major blow to the digital asset industry's efforts to establish itself amid a massive regulatory crackdown in the US.

Voyager liquidation

According to a court filing on May 4, Voyager's estimated initial customer recovery was found to be 35.72%. It also revealed that 38 “unsupported” tokens – such as Tron (TRX), Solana (SOL), Algorand (ALGO), Celo (CELO) and Avalanche (AVAX) – cannot be withdrawn and will therefore be liquidated and returned to customers.

On the other hand, those with any of the 67 “supported” assets such as Bitcoin (BTC) and Ether (ETH) can withdraw the permitted percentage of their holdings directly. The first distributions are expected to begin in the next few weeks.

The deadline for objections to the liquidation proceeding is May 15 at 4:00 p.m. EST, and responses must be filed with the U.S. Bankruptcy Court for the Southern District of New York.

Purchase transaction errors

Voyager filed for bankruptcy protection in July 2022 after crypto hedge fund Three Arrows Capital (3AC) defaulted on a significant loan position extended by the platform. Since then, the company has been working on how to return assets to investors who have used its services.

FTX won the bid to purchase its assets in October 2022, a month before its own final collapse. Voyager subsequently received an offer from Binance.US, which it described as “the highest and best offer for its assets following a review of strategic options with the core objective of maximizing the value returned to customers and other creditors in an accelerated timeframe.”

Binance.US spent months trying to convince regulators to approve the acquisition but encountered several obstacles, including opposition from the Securities and Exchange Commission (SEC) as well as the country's Committee on Foreign Investment.

The $1 billion deal ended last month after the exchange issued a termination letter highlighting the hostile regulatory climate. Voyager called the development “disappointing.”

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