Crypto Lender Voyager Digital To Resume Cash Withdrawals Next Week
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August 5, 2022 7:10 pm
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Crypto lender Voyager Digital made news recently when it revealed that it would be going through bankruptcy proceedings as a result of the crypto winter.
On the bright side, it seems that the court has approved a new $270 million plan which will allow the company to return capital back to its customers.
This is to honor all the withdrawal requests which would all be processed within 10 business days according to the company.
The bankruptcy of many crypto lenders during the current market condition has caused many crypto investors to rethink where they put their digital assets and reconsider more secure options like private wallets.
Voyager plans to resume cash withdrawals on Aug. 11
The lending firm said clients with U.S. dollars in their accounts could withdraw up to $100,000 in a 24-hour period, with the funds received in 5–10 business days.
Crypto lender Voyager Digital Holdin… https://t.co/wPYPj40wEz pic.twitter.com/7FK5W87VFf
— Newscrypto V͇̿I͇̿P͇̿ (@newscryptobtc) August 5, 2022
CoinDesk reports:
The plan comes after Voyager, which is going through bankruptcy proceedings, gained court approval Thursday to honor customers’ dollar withdrawal requests from Metropolitan Commercial Bank, where Voyager had a deposit account.
In a blog post, Voyager said it could take 5 to 10 days to process return requests.
Voyager, which is helmed by CEO Steve Ehrlich, filed in July for bankruptcy protection after suffering massive losses stemming from the implosion of crypto hedge-fund Three Arrows Capital and the broader crypto-market downturn. Its customers had lent it billions of dollars in crypto assets. Those tokens remained locked up for now.
In the blog post, Voyager said it is “pursuing a standalone restructuring process” in an effort to “maximize the value of crypto on the platform.”
Revealed in the company’s recent bankruptcy filing, it is shown that the firm has roughly over 100,000 creditors and still has billions in assets.
The firm had also previously claimed that its customers funds would be insured by the FDIC, but it turns out that this was false marketing.
As a result, Voyager Digital was ordered by the government to cease the false and misleading claims as the only thing that the company had was a deposit account that was not FDIC insured.
It may be a good thing in the long run that many over-leveraged crypto lenders like Voyager cease to exist as it will strengthen the overall crypto market in the long term and leads to safer standards which will increase more mainstream crypto adoption.
Voyager said it anticipates customers will be able to withdraw cash from the $270M account through their apps starting next Thursday, with funds expected to arrive 5-10 days after withdrawal requests are made. https://t.co/b5xR3hyqLP @WSJ #crypto #bankruptcy
— Jodi Xu Klein (@jodixu) August 5, 2022
Reuters.com reports:
The regulators said that the company just had a deposit account at Metropolitan Commercial Bank, and customers investing via its platform had no FDIC insurance. read more
Crypto lenders like Voyager boomed during the COVID-19 pandemic, drawing depositors with high interest rates and easy access to loans rarely offered by traditional banks.
However, the recent slump in crypto markets – sparked by the downfall of two major tokens in May – has hurt lenders.
Good to know, now I can just go withdraw all my mon— https://t.co/6ujzcQit9Y
— Tyler Morin, CIO of THE FAMILY OFFICE 🤌💰 (@JPMorinChase) July 29, 2022
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