According to a Binance blog post, Binance US and Canada have agreed to purchase the assets of Voyager Digital Ltd.
Binance US to Secure Voyager Digital in Bankruptcy Agreement Worth $1 Billion
At the end of June 2022, it was revealed that Voyager Digital had acquired a $500 million credit facility from Alameda Research. However, on July 1, Voyager Digital, which is listed on the TSX, suspended all deposits and withdrawals after a major loss was suffered from Three Arrows Capital (3AC). It was reported that 3AC was owed $655 million by Voyager.
On July 6, Voyager Digital filed for Chapter 11 bankruptcy protection, citing 3AC’s loan default. In late July, the US Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve Board issued a joint letter to Voyager Digital demanding that the FDIC cease and desist all claims that Voyager Digital had made or announced.
Before the fall of grace Sam Bankman-Fried FTX and FTX, it was assumed that FTX could help the company to purchase Voyager Digital’s assets. But, just before FTX’s cracks started to show, Texas regulators and the state attorney general opposed the FTX offer. With FTX now out of the picture, it was revealed on December 19, 2022 that a Binance US buyers had swooped in to buy Voyager Digital’s assets.
The company noted that Binance’s offering from the United States “sets out a clear path for Voyager customers’ funds to be unlocked as soon as possible and returned to them in the form of the cryptocurrencies they previously held in their Voyager accounts.”
“Our offering is a reflection of our guiding principle that customers come first. Our goal is simple: return users their cryptocurrencies in the fastest possible timeline,” said Brian Shroder, CEO of Binance US, Monday. Shroder continued: “We hope our selection ends a painful bankruptcy procedure in which clients were unjustly dragged into it without their fault. On [the] completion of the purchase, users will have seamless access to their digital assets on the Binance US platform where they will continue receiving future disbursements from Voyager Digital’s estate.
Following the speculation and rumors surrounding the world’s largest cryptocurrency exchange by volume, this offering will be made available. There has been some criticism of the company’s practices, such as the removal of its web-based Proof Of Reserve (POR) audit with the accounting firm Mazars. A Reuters report published on Dec. 12 claimed that the US Department Of Justice (DOJ) is currently investigating Binance. The following day, more crypto assets worth $3 billion were withdrawn from Binance’s coffers, as the BUSD stablecoin saw its supply drop by more than $3 billion in just three days.
Voyager Digital posted on Dec. 19 that it “will seek bankruptcy court approval to enter into the asset purchase agreement between Voyager Digital LLC and Binance US at a hearing on Jan. 5, 2023.” Similar to FTX’s attempt at buying Voyager Digital’s assets, it could be objected to Binance’s offer before the January 5 hearing.
Binance further explained that customers should expect to receive emails from these companies regarding next steps soon. Voyager Digital also confirmed the purchase Monday, noting that assets would be purchased for $1.022 trillion, which includes all of Voyager Digital’s crypto assets. In addition to Binance US, INX, Wave Financial?, and Crosstower also participated in the remaining auctions for Voyager Digital’s assets.
“Binance US will make a good faith deposit of $10 million and will reimburse Voyager for certain expenses up to a maximum of $15 million,” the announcement details. “If the deal does not close by April 18, 2023 subject to a one-month extension, the deal allows Voyager to act immediately to return value to customers,” the update concluded.
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