Voyager Plans To Return Customers' Funds 'Within The Next Few Weeks' Despite Failed Binance.US Deal

As part of its bankruptcy proceedings, disgraced cryptocurrency brokerage company Voyager Digital has planned to start returning funds to creditors with "initial distributions" anticipated to commence "within the next few weeks."

Providing an update to customers on Voyager Digital's latest status, Voyager Official Committee of Unsecured Creditors, shared on Twitter that the company has been discussing the final liquidation procedures.

"Voyager and the UCC are in the process of finalizing Liquidation Procedures," the tweet read, noting that "the Liquidation Procedures will provide details on the process for creditors to receive distributions."

The liquidation procedures will detail the method or process by which creditors will receive the funds' distribution from Voyager Digital.

As soon as the liquidation procedures are filed, parties can file an objection to the plan within 10 days after which the court will schedule a hearing to hear the parties' objection before allowing Voyager to its liquidation.

If no objection is filed, the crypto brokerage's distribution plan will take effect.

Both Voyager Digital and the creditor committee are still finalizing the liquidation procedures and plan to submit relevant filings on Friday, May 5.

Last August, the court approved Voyager Digital's proposal to return $270 million of customers' funds.

The latest development in Voyager Digital's bankruptcy proceedings comes on the heels of the news that Binance.US terminated the $1.3 billion asset deal with the crypto brokerage, citing a "hostile and uncertain regulatory climate" in the United States.

"Today we received a letter from Binance.US terminating the asset purchase agreement," Voyager said in a tweet, adding that "while this development is disappointing, our chapter 11 plan allows for direct distribution of cash and crypto to customers (a 'toggle option') via the Voyager platform.

Binance.US, the American arm of one of the world's largest crypto exchange platforms, said that its decision to call off the asset purchase deal was a tough one to make since its offer was intended to help the customers of the bankrupt crypto company.

"Binance.US has made the difficult decision to exercise its right to terminate the asset purchase agreement with Voyager," the exchange said in a tweet.

"While our hope throughout this process was to help Voyager's customers access their crypto in kind, the hostile and uncertain regulatory climate in the United States has introduced an unpredictable operating environment impacting the entire American business community," it added.

"We are focused on creating a safe platform where our customers can participate in the digital asset economy," Binance.US noted.

Voyager suspended withdrawals and other transactions on July 1, 2022.

The crypto brokerage eventually filed for Chapter 11 bankruptcy after a few days on July 6, 2022.