Last week Judge Michael Wiles, who is ruling over Voyager Digital’s bankruptcy proceedings, ruled that there was “sufficient basis” to return $270 million held in a custodial account to customers.
The bankrupt bitcoin and crpyo exchange reportedly has over $10 billion in debt.
Voyager Digital mentioned in a blog post on August 5th:
“We anticipate resuming access to the Voyager app for cash withdrawals only, starting on Thursday, August 11th. Customers with cash (US dollars) in their accounts will receive an email with more details before cash withdrawal access in the app becomes available.”
Voyager won’t be resuming withdrawals of bitcoin or crypto, but there might be some hope for investors that hold USD with Voyager.
The company will use the $270 million held in a custodial account at Metropolitan Commercial Bank to begin returning USD funds to Voyager customers that have a USD balance.
Voyager further stated:
“Requests will be processed as quickly as possible but will require some manual review, including fraud reviews and account reconciliation, and timing will depend, in part, upon the individual banks to which customers transfer their cash. Once cash withdrawals are enabled, customers can withdraw up to $100,000 via the app/ACH in a 24-hour period.”
It is unclear how much all Voyager customers combined hold in USD compared to bitcoin or crypto. However, the announcement should give some hope to customers that hold a USD balance at Voyager.
According to Voyager, the company is talking to several parties that are interested in acquiring the insolvent exchange. Although it recently turned down an offer by Sam Bankman-Fried’s FTX, Voyager reportedly has 88 interested parties bidding to acquire Voyager Digital
Whether Voyager clients will ever get to see any of their bitcoin or crypto holdings, and how much of it, is yet to be seen. Celsius, the bitcoin and crypto lender that recently filed for chapter 11 bankruptcy, is in a similar situation as Voyager.
Singapore-based bitcoin and crypto lender Hodlnaut announced just today that they were halting withdrawals as well. The current contagion that is spreading throughout the bitcoin and crypto markets is an important lesson for the future: “Not your keys, not your coins”.
