A popular crypto derivatives exchange, FTX, has reportedly submitted a proposal to allow customers of struggling Voyager Digital access to early liquidity. The company confirmed this development in a Twitter post. The proposal by FTX will help customers of the crypto lender recover part of their funds.
Also, the proposal offers eligibility to Voyager customers to create a new account on FTX. Reportedly, the users will get an opening cash balance representing a fraction of their bankruptcy claim.
In the proposal, the customers will be eligible to withdraw the funds immediately or use the funds to acquire crypto assets on FTX. However, the derivatives exchange says the proposal is voluntary, and the customers may choose not to participate.
Additionally, FTX insisted that participants in the proposal will not obtain Voyager loans to Three Arrows Capital. According to the exchange, all funds recovered from the debt will be used in catering for more customer refunds.
The Chief Executive Officer of FTX, Sam Bankman-Fried, confirmed the issuance of the proposal in a post. According to Bankman, “Voyager’s customers did not choose to be bankrupt investors holding unsecured claims.” He explained that the essence of the joint proposal is to create an acceptable way to resolve insolvency ravaging crypto businesses.
According to Bankman-Fried, FTX hopes to create an avenue that allows customers to obtain early liquidity and recover a fraction of their assets. The CEO further said that the derivatives exchange aims to assist the customers without compelling them to speculate on bankruptcy outcomes and take one-sided risks.
As of press time, Voyager Digital is yet to respond to the joint proposal. However, the derivatives exchange has now fixed a July 26 ultimatum for the crypto lender to respond to its proposal. FTX hopes to finalize the deal within the first week of August.
Recall that the crypto lender, Voyager Digital, had on July 1 discontinued withdrawals. It reportedly filed for bankruptcy a few days after. The firm has, however, given updates on its restructuring process as its next court hearing is slated for August 4.
The crypto lender relayed plans to secure court approval to allow customers who deposited USD to withdraw their assets. It further declared that all USD deposits are FBO accounts at Metropolitan Commercial Bank (MCB).
In addition, the crypto lender is attempting to sell Coinify, an asset described as a non-core asset. It added that it had obtained court permission to pay employees and settle other operating costs in the regular course of business. According to Voyager, the bills were paid from its operating cash, not cash included in the FBO accounts.
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