Judge Approves Voyager Deal to Reserve $445 million After Alameda Lawsuit
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A federal judge, John Dorsey, has approved Voyager Digital’s agreement with FTX to reserve $445 million after Alameda Research sued the defunct crypto lender.
Possibility for Alameda and FTX to Reclaim Assets
Bankrupt crypto trading company Alameda Research recently sued the failing cryptocurrency lender Voyager Digital for more than $445 million. The goal behind the court filing was to attempt to recoup loan repayments made after Voyager sought bankruptcy protection.
Judge John Dorsey approved the agreement between both parties on March 8th, following the cancellation of a hearing for FTX earlier that day in the United States Bankruptcy Court for the District of Delaware.
The filing, which was made in a federal bankruptcy court in Delaware, stated that the total amount requested by Alameda’s attorneys was $445.8 million. However, the money could increase if additional evidence of transfers from Alameda to Voyager is discovered. Aside from that, the firm wishes to have its legal fees reimbursed.
Alameda’s attorneys criticized Voyager in court documents for its role in the demise of FTX and Alameda. Voyager was branded as a feeder fund that did little to no due diligence before investing retail investors’ money.
One of the FTX-related companies, Alameda, declared bankruptcy in November. However, the cryptocurrency trading firm paid funds to Voyager after the crypto lender filed for bankruptcy last July.
This was prior to Alameda Research filing for bankruptcy protection. Lawyers are hoping to recoup the funds, and after being sued, the defunct crypto lender Voyager Digital agreed to set aside $445 million.
Both firms agreed to participate in non-binding mediation and create a framework for the litigation of any remaining disputes. The aim was to create an easy way for FTX and Alameda Research to recoup their assets.
The Alameda litigation may cause significant consequences for Voyager customers. A different federal judge overseeing the Voyager case approved a proposal for Binance.US to purchase Voyager assets.
Under the reorganization plan, Voyager customers were supposed to receive 73%. However, if the FTX and Alameda lawsuits are successful, that number would fall to 48%, according to attorneys.
Binance.US Gets Go-Ahead to Buy Voyager Digital Assets
The United States branch of the giant crypto exchange, Binance.US, recently got the green light to purchase the assets of insolvent cryptocurrency lender Voyager Digital.
The proposal was confirmed by a federal judge, Michael Wiles, after a four-day marathon hearing that spanned last week and this week.
The judge approved Voyager’s updated restructuring plan, which included the $1 billion deal with Binance.
The Securities and Exchange Commission (SEC), other agencies, and some individual creditors who raised concerns about Binance all objected to the deal.
Although Wiles acknowledged their concerns, he claimed he had not seen concrete proof that Binance.US should be rejected.
Throughout the hearing, Wiles contended with many governmental organizations. He chastised the SEC for informing the court that Binance’s personnel believe it is operating an unregistered exchange in the United States. Still, it has not declared an official position or provided any evidence.
Wiles also had harsh words for the attorney for the Southern District of New York’s U.S. Attorney’s Office. The attorney had objected to the provision of a criminal exoneration for parties who implement portions of the Voyager plan.
Wiles concluded the restructuring plan after hearing testimony that lasted more than 20 hours. The hearing was held in the U.S. Bankruptcy Court for the Southern District of New York.
