The Federal Bankruptcy Court has granted Voyager Digital permission to execute user withdrawals.
According to a recent court filing, Voyager is demanding a judicial permit to approve users' withdrawal petitions. The sum is in excess of $350 million. The monies are held in a For Benefit of Customers (FBO) account at New York's Metropolitan Commercial Bank.
This line is being pursued by the company in order to alleviate customer concerns and restore investor trust. According to the company, “failing to honor consumer withdrawals any longer could materially impair customer morale.”
Recall that on July 4, Voyager Digital halted withdrawals on its platform due to a market collapse. The company stated at the time that the move would give it time to consider potential solutions to the issues caused by the current negative run.
Shortly after, the ailing firm filed for chapter 11 bankruptcy protection in order to retain its assets and maximize consumer value.
The failing company claims to have $1.3 billion in crypto assets on its platform and over $350 in its FBO account with Metropolitan Commercial Bank.
In addition, Voyager claims to have claims in excess of $650 million with Singapore-based Three Arrows Capital.
Along with its appeal for authorization to honor withdrawals, Voyager also requests permission to proceed with its other financial services. These involve liquidation user accounts with negative balances as well as liquidating sweep cash through third-party exchanges.
Furthermore, it intends to carry out regular course reconciliation on customer accounts while also continuing its crypto staking services.
With clients' assets still locked, the crypto community awaits the court's decision on the matter. The hearing has been scheduled for August 4, 2022, at 11:00 a.m. E.T.
The extended bear market continues to harm the fortunes of firms in the emerging industry.
Three Arrows Capital, a failed cryptocurrency lender, has filed for chapter 15 bankruptcy in the United States after a British Virgin Islands judge determined that the firm should be liquidated. Other cryptocurrency lenders, such as Celsius, Vauld, and Babel Finance, have all halted withdrawals on their platforms.
Several companies, including Coinbase, Gemini, and BlockFi, have decreased personnel in order to remain operational.
As a reminder, WikiBit is ready to help you search the qualifications and reputation of projects in a bid to protect you from hidden dangers in this risky industry!
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