By Shelly Melancon (Switzerland)
Voyager Digital Holdings, a crypto lending platform, has announced plans to reopen its withdrawal services soon. The crypto lending firm halted withdrawals and other services last month following a string of poor market performance, leading to a massive loss.
A New York court recently cleared the lending platform after it agreed to return $270 million in customer funds.
Voyager Commences Withdrawal Again
The company announced that it would reopen its withdrawal services on August 11 following a brief suspension. This is the firm’s first move as it attempts to return the $270 million in assets belonging to its customers as cleared by the bankruptcy attorney.
Voyager Digital suspended withdrawals following bankruptcy claims on the first day of last month. In addition, the company revealed that it had suffered a massive loss due to the collapse of Three Arrows Capital (3AC).
As a result, the company stopped the withdrawal of further funds by moving the assets to the custody of the Metropolitan Commercial Bank in New York. Customers of the lending firm were unable to access their funds until the latest rulings from the court.
Voyager Digital will now allow its mobile app to process customers’ withdrawal requests of not more than $100,000 a day.
Additionally, Voyager announced that it would quicken the withdrawal process and quickly process the request. It will also manually review the customer’s account statement as well as fraud history. The duration of the withdrawal request also depends on the banks to which the customers want to send their funds.
Also read:Voyager’s Journey to Bankruptcy
Trouble began for the crypto lending firm when it reported that it had secured a $500 million loan in June. The said loan is with Sam Bankman-Fried’s FTX subsidiary, Alameda Research. Before the loan agreement, Voyager had a huge stake in the Three Arrows Capital (3AC) crypto hedge fund product.
Furthermore, 3AC already owed Vogayer a whopping $680 million loan, which it failed to repay. Three Arrows Capital was also affected by the collapse of the Terra LUNA network. As a result, a court in the British Virgin Islands ordered 3AC to liquidate.
Upon realizing that it could not repay the loan owed to Voyager, the company filed for Chapter 11 bankruptcy in New York on July 5.
However, when filing the claims, the hedge fund manager claimed it was undergoing reorganization. The change in operation strategy enables users to access their accounts upon restoring its services.
In July, FTX forwarded a buyout option for Voyager, which the company rejected. Voyager cited the deal as not favorable to its customers, but it is still open to a potential sale.
The bankruptcy experience has put Voyager in a delicate situation as it struggles to stay afloat amid the market downtrend.
Having been cleared by the court of any pending bankruptcy, the company wants to restructure its operation. Additionally, the court has also given the green light for the sale of the company, with bids expected to last on or before August 26.
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