Voyager Clients Vote 97% in Favor of $1B Restructuring Plan

The bankrupt crypto broker Voyager Digital announced that 97% of its customers with account holder claims have voted in favor of the proposed restructuring plan that will see Binance.US acquire the firm’s assets for $1.02 billion.

Bankruptcy administration company Stretto, which conducted the poll, divided the eligible voters into four categories, one for “account holder claims” and three for “general unsecured claims.” The majority of voters representing the latter groups also voted in favor of the proposal.

General unsecured claims have a lower priority and may not be paid until the account holder claims are paid in full.

Voyager added that more information will follow after a hearing scheduled for Thursday.

The New York-based Voyager filed for bankruptcy in July 2022, citing the firm’s exposure to Three Arrows Capital (3AC). At the time, Voyager said it had more than 100,000 creditors and between $1 and $10 billion in assets, with the same range for its liabilities.

3AC, a Singapore-based crypto hedge fund, failed to meet margin calls from several lenders prior to that, also filing for bankruptcy.

In December 2022, after the purported deal with FTX fell through due to the collapse of Sam Bankman-Fried’s crypto empire, Voyager announced that Binance.US—the American entity of Binance—had made the highest and best offer for its distressed assets, with the approximate value of the deal of $1.022 billion.

If the deal is executed, Voyager customers will get up to 51% of their capital back.

No easy way out for Voyager

The U.S. bankruptcy court gave Voyager permission to enter into an asset purchase agreement with Binance.US and to hold a vote among its creditors on the sale in January, with the deal not to be finalized until a court hearing on March 2.

There could be a few roadblocks to Binance.US acquiring Voyager’s assets though as several regulators, including the U.S. Securities and Exchange Commission (SEC) and the Federal Trade Commission (FTC) are questioning the deal.

In a filing last week, the SEC said it was formally investigating whether Voyager violated anti-fraud, registration and other federal securities laws. The agency also claimed that Voyager did not “sufficiently explain what safeguards have been established to ensure that customer assets are not transferred off the Binance.US platform.”

The FTC meanwhile alleges that should the deal go through, it would unlawfully bar the company from being held accountable for “actual fraud, willful misconduct, or gross negligence.”

In a separate filing, the New York Department of Financial Services (NYFDS) said Voyager onboarded customers in New York and “thus illegally operated a virtual currency business in the state without a license.”