After multiple intense rounds of bidding, Voyager Digital LLC has selected FTX US as the highest and best bid for its assets. The Official Committee of Unsecured Creditors (UCC) participated actively in the competitive auction and supports FTX US’s winning bid. This news came in the form of an announcement by Voyager Digital Ltd. on the 26th of September.
FTX US shines the silver lining for firm and customers
FTX US, the bitcoin exchange founded by billionaire Sam Bankman-Fried, is set to acquire cryptocurrency lender Voyager Digital’s assets after winning a bankruptcy auction. This is welcome news to worried customers of the hard-pressed crypto trader.
In a statement late Monday, it was announced that FTX US was selected as the highest bidder for Voyager’s assets, with a bid valued at approximately $1.422 billion. The bid comprises $1.3 billion for the fair market value of the digital assets, and a further $111 million in anticipation of incremental value.
A number of factors have contributed to Voyager Digital’s downfall. Besides the crypto market’s current bear run, the collapse of Three Arrows Capital, a hedge fund which included Voyager Digital’s assets and engaged in risky gambles on tokens, was also partially responsible for the fall. Amongst these tokens include the now collapsed stablecoin terraUSD.
Three Arrows Capital defaulted on borrowings from Voyager amounting to $670 million earlier in June. Voyager Digital’s claims against Three Arrows Capital remain with the bankruptcy estate, which will distribute any available recovery on such claims to the estate’s creditors.
Moving forward, FTX US’s $1.4 billion bid aids in maximizing the asset value and reducing Voyager Digital’s restructuring period. Voyager have suggested the possibility of merging its customers with FTX US’s own. CNBC reported them saying the exchange “will enable customers to trade and store cryptocurrency after the conclusion of the Company’s chapter 11 cases.” FTX US’s market-leading, secure trading platform will enable customers to trade and store cryptocurrency after the conclusion of the Company’s chapter 11 cases.
Besides aiding FTX US’s transitional period and opening the door for future trading, the merger is a fresh source of hope for the beleaguered crypto customers. With few legal avenues for the customers due to their treatment as ‘unsecured creditors’, FTX US has placed the possibility of compensating users of Voyager back on the horizon. It may be their best chance yet. Comparatively, creditors of Mt.Gox have been waiting for any form of recompense since 2014, the year the exchange went down.
This is not the first time FTX US 30-year-old Founder Bankman-Fried has come through as a beacon of hope this stretch of the crypto bear market. As numerous companies and exchanges suffered from the market’s fourth largest drawdown in Bitcoin’s history, Bankman-Fried has been seeking the best bargains, easing the transition period of many firms post their downfall.
Up Next: AIBC Malta Week 2022
After the successful completion of the AIBC Toronto and Dubai Summits, SiGMA Group is working diligently on this year’s edition of Malta Week. From the 14th to the 18th of November, the company’s most prominent brands will be brought together under one roof for the AIBC Europe Summit, the premier networking opportunity of the year. The Summit at MFCC Ta’Qali is a stellar expression of European innovation in the Gaming, Esports and Emerging Tech sectors, featuring numerous panels and conferences by leading experts. Interested in joining our long list of speakers, exhibitors or sponsors? Please contact Sophie to reserve your spot, or visit our website for more information.