Voyager Digital finally acquires funds to reimburse 35% of its former customers

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  • Voyager Digital initially had various relations with the third largest crypto exchange owing Sam Bankman at least $75 million.
  • The company will return about %1.33 billion in crypto assets to customers.
  • The 2023 crypto winter had ravaged the market, reducing the value of crypto to an all-time low of $16,000.

It is common knowledge throughout Africa and the globe that the FTX crash resulted in catastrophic losses. The plummet of the third largest crypto exchange created a vacuum that resulted in the 2023 crypto winter. Furthermore, its sudden demise spelt doom upon most associates and clients. The entire market soon experienced a domino effect as more exchanges fell due to bankruptcy. In its wake of destruction, Voyager Digital, a crypto lender, was among the first to fall. Fortunately, some fron of grace shines upon its disgrace as they have announced their customer will soon recover about 35% of their crypto deposits.

This news comes as a light at the end of the tunnel, and it might even signify the brutal 2023 crypto winter is finally warming up.

The Fall of Voyager Digital

During the Q2 and Q3 of 2022, the crypto market experienced some form of turmoil. Voyager Digital, a high-profile crypto lender, had filed for bankruptcy after citing market volatility brought about by the sudden collapse of Three Arrows Capital. The crypto lender was unable to maintain its trajectory amin the unprecedented event.

Before the FTX crash, it initially had various relations with the third largest crypto exchange owing Sam Bankman at least $75 million. At the time, FTX attempted to rescue Voyager Digital from its impending doom, but, unfortunately, this only threw it further down the rabbit hole. 

Also, Read The scramble among big companies to buy more Bitcoin as supply wanes.

The fall of Three Arrows Capital had significantly affected it since it owned the crypto lender for more than $650 million. Unfortunately, with its fall, Voyager Digital only had a lifeline of $485 Million and about $960000 to Google. Unfortunately, this was a merger amount unable to cover its entire debt.

Voyager-Digital
Voyager Digital used to be a high-profile crypto lender, but it struggled with the Covid Pandemic and could not survive the volatile markets.[Photo/BBC]
In a press release, the crypto lender stated that it was pursuing all available remedies for recovery from 3AC. Unfortunately, this active pursuit was unsuccessful, and now the company had only one alternative to oblige by the crypto laws and file for bankruptcy.

On June 2022, after Voyager Digital and Three Arrow Capital went under, it marked the start of the FTX crash. Unfortunately, we could not predict its downfall until it was too late. With its crash came along harsh crypto law resulting in the closure of any exchange associated with FTX.

Binance tried to save the crypto lander but soon discovered its association carried heavy packages. Thus the largest crypto exchange cut its last strand of hope by pulling out of its initial deal.

Voyager Digital announces a ray of hope.

Despite the hash crypto laws and the 2023 crypto winter, Voyager Digital has announced hope for its stranded users. U.S. Bankruptcy Judge Michael Wiles approved Voyager’s liquidation plan at a Manhattan court. In doing so, the company will return about %1.33 billion in crypto assets to customers. According to the crypto lender’s official, creditors committed, customers will e able to withdraw by June 1st, 2023.

At the beginning of the year, the 2023 crypto winter had ravaged the market, reducing the value of crypto to an all-time low of $16,000. This marked its lowest point since 2021 after hitting the $64,000 mark. After it declared bankruptcy Voyager’s customers soon gave up hope on the crypto market.

Also, Read Africa: A closer look into Web3’s evolutionary transition into the digital economy.

Its last strand of light heavily depended on the outcome of litigation with FTX. This would result in a clawback of $445.8 million in loan repayments made to Voyager before its collapse. If the crypto lender could fully prevail, it would review at least 64% of its total loss. Despite its initial estimation, Voyager Digital still suffers heavily from the 2023 crypto winter.

Despite its failure being the opening act of the FTX crash, the crypto lender is still categorized under the crypto lenders that failed during the pandemic. Other crypto networks included; Celsius Network, BlockFi, and Genesis Global Capital.

The crypto lender has stated that it intends to reimburse its clients with the same crypto coins invested. The organization will pay customers using the stablecoin USDC for any cryptocurrency currently unavailable.

Conclusion

The 2023 crypto winter has been significantly tricky for most crypto exchanges. A majority of the crypto market briefly went dormant after the FTX crash. Its impact was so severe it had affected Africa’s crypto adoption rate, significantly lowering its 1200% mark.

Furthermore, the SEC tightened their grip on crypto laws and persecuted any exchange seeking to promote their services in the U.S. The tight leash on crypto laws has caused mass panic among crypto ledges. Binance, Kraken, and Coinbase clashed with the SEC due to sevral crypto laws.

Also, Read Over 4 million Kenyans lost their monies to the ongoing crypto crash.

However, the market has steadily regained momentum as Bitcoin steadily gains value. In addition, multiple crypto-based projects are currently underway, and we may ee additional collaborations. Voyager Digital recovering some aspects of control means there is still some future within the 2023 crypto winter.

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Ken Mutuku
Ken Mutuku
Your Guide to the Future of Tech, Web3, and Digital Storytelling. With a keen eye for detail and a knack for concise communication, Ken Mutuku is your go-to professional for decoding the next wave of technological evolution. Whether through captivating videos, insightful articles, or engaging presentations, he masterfully crafts messages that deeply resonate with his audience, setting him apart in the digital landscape.
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