Voyager Customers Can Now Withdraw Assets as FTX Provides Redemption

Leading American cryptocurrency exchange FTX announced a joint proposal with venture capital firm Alameda Ventures Ltd and West Realm Shires Inc., operator of the FTX U.S., to offer early liquidity to Voyager Digital customers. 

Voyager Customers Can Redeem Their Funds

The Sam Bankman-Fried exchange has become crypto’s white knight in recent weeks, bailing out ailing companies struggling to maintain their balance, and this time, FTX is offering Voyagers customers a lifeboat.

“Voyager’s customers did not choose to be bankruptcy investors holding unsecured claims. The goal of our joint proposal is to help establish a better way to resolve an insolvent crypto business – a way that allows customers to obtain early liquidity and reclaim a portion of their assets without forcing them to speculate on bankruptcy outcomes and take one-sided risks,” said Bankman-Fried, CEO of FTX. 

Recall that Vovager filed a bankruptcy petition in the Southern District of New York earlier this month following a dramatic fall in cryptocurrency prices which led to the collapse of Three Arrows Capital (3AC), a major hedge fund in the industry. 

3AC was unable to repay the $670 million it borrowed from Voyager, leaving the brokerage company exposed and unable to honor users’ withdrawal requests. 

Participation is Optional

Per the Friday announcement, users of the troubled crypto brokerage would be allowed to open a new account on FTX with an opening cash balance sponsored through the early distribution of a portion of their bankruptcy claims.

The crypto exchange noted that customers can redeem their funds with the option to withdraw their assets immediately or use the funds to purchase other cryptocurrencies on the platform. In addition, the firm highlighted that participation in the joint offer is voluntary, and no customer is obligated to participate. 

FTX to Close the Joint Offering in August

FTX disclosed that it intends to close the deal as soon as possible, preferably in early August, and the offering is subject to the “requirements of Chapter 11 bankruptcy process and the need for court approval.”

The exchange stated that none of the participants in the joint proposal would be helping to acquire Voyager’s loans from Three Arrows Capital or related litigation claims. The participants expect the brokerage company to pursue its rights in recovering the loan from 3AC.