Defi News- Voyager requested a court order to allow customers to withdraw cash.
- Voyager received the go-ahead from presiding judge Micheal Wiles.
As per a report by WSJ, the U.S. Bankruptcy Court in New York has approved Voyager Digital’s repayment of $270 million to impacted consumers. Voyager received the go-ahead from presiding judge Micheal Wiles on Thursday to release funds held in a custodial account at the Metropolitan Commercial bank to its clients (MCB).
Cryptocurrency values plunged in July, forcing Voyager to cease withdrawals and apply for chapter 11 bankruptcy protection in New Jersey. Voyager requested a court order to allow customers to withdraw cash held in the MCB’s custody during the liquidity crisis.
$660 Million Loan to 3AC
More than a billion dollars left on Voyager is a part of the bankruptcy estate, which Voyager says would be dispersed among all creditors. The failure of Voyager occurs as a result of its involvement with the well-known cryptocurrency hedge fund Three Arrows Capital (3AC).
Voyager gave 3AC $660 million, but the hedge fund defaulted because of its $200 million exposure to Terra. Stephen Ehrlich, CEO of Voyager, sought financial advice from Moelis & Company after 3AC’s failure.
Additionally, Mike Novogratz’s investment business Galaxy Digital owes Voyager $34.4 million in loan commitments, while Genesis Global Capital owes $17.5 million in loan obligations. Genesis Global Capital and Galaxy Digital both have exposure to 3AC and Terra.
Following its exposure to Terra in May, Galaxy Digital initiated a $10.6 million share buyback program. It was revealed in a series of tweets by Michael Moro Genesis’ chief executive that the loans to Three Arrows were over 80 percent leveraged, although no specific loan amount was revealed in those tweets.
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Source: https://thenewscrypto.com/voyager-digital-receives-approval-to-return-270m-to-users/