Voyager Digital has declared that it has successfully retrieved $484.35 million from insurance settlements for directors and officers (D&O), FTX, and Three Arrows Capital (3AC).
The announcement on April 10 was part of a thorough status report about the recovery and distribution of assets to creditors following the company’s financial downfall that was provided to the United States Bankruptcy Court for the Southern District of New York.
According to the report, a sizeable chunk of the money that was recovered—roughly $450 million—will come from the FTX settlement. This sum, inclusive of interest, is purportedly equivalent to roughly 25% of the initial demands put forth by Voyager’s creditors.
This is something the company plans to distribute in a future round. Furthermore, Voyager has obtained a claim of around $675 million in the ongoing proceedings with Three Arrows Capital. Voyager will receive $20.43 million as its pro rata portion of its initial payout.
As assets are liquidated and legal recoveries are made, the plan administrator expects to make more payments in the upcoming years. Voyager’s creditors will get at least $14.35 million from a settlement in the D&O insurance mediation, which represents yet another attempt to address the financial hardship the company’s stakeholders have experienced.
The logistical issues in Voyager’s report were further discussed, including the approximately 270,000 uncashed cheques worth $17 million. About 187,000 of these checks are for amounts less than $25, a sizable share.
The business has set a deadline of April 20, 2024, beyond which all unpaid checks would be deemed unclaimed and canceled. The company is also dealing with the fallout from a data breach, and investigations are still underway to determine the extent and cause of the breach.
The breach compromised Information about creditors, which made the bankruptcy process much more difficult. In July 2022, Voyager filed for Chapter 11 bankruptcy amid a larger crypto credit crisis that affected many brokers and lenders.
On May 17, 2023, the United States Bankruptcy Court for the Southern District of New York granted Voyager’s bankruptcy petition. This came after cryptocurrency exchange Binance.US withdrew its April 25 announcement that it would buy $1 billion in assets from Voyager.
The Commodities Futures Trading Commission (CFTC) charged Stephen Ehrlich, a co-founder of Voyager Digital, in October 2023 for allegedly engaging in fraud and neglecting to register with the organization.
The CFTC charged Ehrlich and Voyager with deceiving customers about the firm’s financial stability when it was on the verge of failure. Voyager revealed obligations of between $1 billion and $10 billion when filing for bankruptcy, underscoring the serious financial difficulties that necessitated the company’s need for bankruptcy protection.
