Voyager Digital Provides Update on Recovery Plan
Under the plan, customers would receive a pro-rata share of Voyager's assets.
Key Takeaways
- Voyager Digital has published an update on its plans to return account balances to its customers.
- The firm says that it has $1.3 billion of cryptocurrency and $650 million in claims against 3AC to distribute.
- Voyager did not say exactly how much users will receive, but added that users will be able to vote on the plan.
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Failing cryptocurrency lending company Voyager Digital announced a recovery plan for users in a blog post today.
Voyager Will Pay Out Asset Shares
Following its earlier decision to suspend withdrawals, Voyager now says that it plans to return funds to users.
“We are working to restore access to USD deposits, which belong to customers and will go back to those same customers,” the company wrote in a blog post dated Jul. 11.
Voyager explained that it is holding customer funds in a For Benefit of Customers (FBO) account at the Metropolitan Commercial Bank of New York. Those funds will be available following a “reconciliation and fraud prevention process.”
Voyager did not say exactly how much money customers will receive. However, it did say that it has $1.3 billion of cryptocurrency and over $650 million in claims against Three Arrows Capital.
Customers will receive a pro-rata share of four different assets: cryptocurrency, proceeds from the 3AC recovery, common shares in the reorganized company, and existing Voyager tokens.
Furthermore, customers are insured for up to $250,000 under Federal Deposit Insurance Corporation (FDIC) insurance.
Customers May Not Be Satisfied
Voyager suspended withdrawals on Jul. 1 and filed for bankruptcy days later. While the recovery plan is a step toward paying back customers, not everyone will be satisfied.
Under the plan, users will receive only a share of Voyager’s assets. This likely means that some users will receive less than their account balance—though it is ambiguous as to whether the firm intends to restore standard withdrawals as well.
Additionally, reports concerning Voyager’s FDIC policy have caused controversy. While the firm initially advertised overarching FDIC insurance, recent statements contend that this insurance only applies in the event of Metropolitan Commercial Bank’s failure—not Voyager’s failure. Today’s update confirmed this.
Dissatisfied customers may take other courses of action to recover their funds. One legal firm, Siskinds LLP, announced a class-action suit on behalf of Voyager users today.
Voyager also says that its recovery plan is not necessarily final; customers will be able to vote on the proposal described today.
Disclosure: At the time of writing, the author of this piece owned BTC, ETH, and other cryptocurrencies.
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