Having admitted that they are in a bad time, a representative from Alameda has assured that their proposed plan to reorganize the firm is the right call.
Earlier this month, Voyager Digital Holdings filed for bankruptcy in New York for insolvency worth over $1 billion. This was after crypto hedge fund Three Arrows Capital (3AC) defaulted on a $650 million loan from the firm. In response, FTX.com owned and operated by FTX Trading Ltd in conjunction with the owner of FTX US, and Alameda Ventures Ltd, West Realm Shires Inc. made a public proposal to provide early liquidity for the crypto lending firm. FTX, FTX US, and Alameda planned to buy out all the assets of Voyager as well as its outstanding loan except the one defaulted to 3AC. However, in a rejection letter filed in court, the lawyers of Voyager denounced the offer from Alameda, claiming it could potentially harm customers. In addition, the actions “are not value-maximizing”.
According to the letter, Alameda violated many obligations to the debtors and the bankruptcy court. Also, bringing it over to the public could affect any potential deal by subverting “a coordinated, confidential, competitive and bidding process.”
Having admitted that they are in a bad time, a representative of the company has assured that their proposed plan to reorganize the firm is the right call. Also, he stated that they will deliver all the customers’ cash and their cryptos as soon as possible.
FTX CEO Sam Bankman-Fried believes that his proposal would have helped customers to recover their losses and exit the platform.
In one of his Twitter threads, Bankman-Fried stated that Voyager customers have been through enough already and should not have any problem claiming their assets if they want them sooner. His reason is that bankruptcy proceedings can take years.
“Voyager’s customers did not choose to be bankruptcy investors holding unsecured claims. The goal of our joint proposal is to help establish a better way to resolve an insolvent crypto business,” he said.
Voyager’s lawyers in response disclosed that the deal is not as juicy as it seems. According to them, it is just a liquidation of Voyager’s assets to the advantage of Alameda. The lawyers also refuted the popular claim that Voyager had a better chance of winning the acquisition bid due to the relationship between the two.
“Nothing could be further from the truth as evidenced by this response,” stated the lawyers.
Excellent John K. Kumi is a cryptocurrency and fintech enthusiast, operations manager of a fintech platform, writer, researcher, and a huge fan of creative writing. With an Economics background, he finds much interest in the invisible factors that causes price change in anything measured with valuation. He has been in the crypto/blockchain space in the last five (5) years. He mostly watches football highlights and movies in his free time.
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