Bankruptcy lender Voyager receives the highest bid from these heavyweight companies

According to those familiar with the situation, FTX and Binance have made the highest bids for the assets of defunct crypto lender Voyager Digital Ltd. , VYGVQ -5.89%, but no offer has been accepted yet, This was reported by the Wall Street Journal.

According to the sources, the current offer from Binance is around $50 million, which is slightly more than the competing offer from FTX.

Founded in 2019, Voyager operates a crypto lending platform that accepts deposits from customers, pays interest on those deposits, and then leases assets to third parties. In 2019, it went public through a reverse merger. The company’s market capitalization was $3.9 billion at the stock’s peak in 2021.

Voyager claimed it had $5 billion in total assets and $4.9 billion in total liabilities at the time of its July 2022 bankruptcy filing.

So what does this mean?

Among the few beneficiaries of the crypto collapse are FTX and Binance. Both succeeded in increasing their market share. Sam Bankman’s company, FTX Fried, was actively acquiring distressed assets during the recession.

On September 13, Voyager’s assets were put up for auction. Wave Financial, a cryptocurrency investment manager, and trading platform CrossTower are other bidders.

It is also possible that another bidder may submit a new competing bid. The winning bid will be revealed at a hearing in New York on September 29, but that could happen soon.

Where did all this start?

Voyager, which is headquartered in New York and trades in Toronto, filed for bankruptcy in July after crypto sales led to an outpouring of withdrawal requests that drained the company’s cash reserves. At the time of filing, the value of its stock is down more than 95% from 2022.

Because it issued $1.1 billion, it was unable to meet the withdrawal requests and instead curtailed and suspended them. Voyager loaned more than $650 million to a hedge fund Three Arrows Capital Limited, which represents more than half of the total.

After creditors sued the company over the failure of the TerraUSD stablecoin, a court in the British Virgin Islands issued a liquidation order for Three Arrows in June.

Commercial company Alameda Research was another borrower, and at the time of the bankruptcy filing, it owed $377 million in crypto to Voyager.

In its July bankruptcy filing, Voyager claimed the company also sold a portion of itself to Alameda, which holds a 9.5% stake.

Alameda provided Voyager with two lines of credit in June, one for $200 million in cash and the other for 15,000 bitcoin. Alameda was Voyager’s largest creditor at the time of its bankruptcy, having an unsecured loan of $75 million.

Alameda has agreed to repay about $200 million In a borrowed cryptocurrency in a court filing dated September 19 for $160 million in collateral held by Voyager.

FTX and Binance competed to buy Voyager’s assets in a bankruptcy auction, which was held last week in New York, according to previous reports. The final results of the auction are expected to be announced on September 29, although that date may be earlier.

Leave a Comment