Voyage Self-Liquidates After $1 Billion Binance Deal Collapses

Bankrupt crypto lender Voyager Digital is closing down following two failed attempts to sell itself.

According to a Friday (May 5) court filing, the company will self-liquidate its assets and wind down operations. The announcement came 10 days after Binance.US walked away from a plan to purchase Voyager for $1 billion.

As PYMNTS reported, Binance.US gave no reason for its decision in an April 25 court filing announcing its termination of the deal. That decision came just days after U.S. regulators dropped their efforts to stop the sale.

“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,” Voyager said on Twitter following the end of the deal.

“Consistent with the plan, we will now move swiftly to return value to customers via direct distributions. We will provide more information on next steps and any actions customers need to take in the coming days.”

Voyager Digital originally filed for Chapter 11 bankruptcy protection last July, saying in a filing before the bankruptcy court for the Southern District of New York that it was “facing a short-term ‘run on the bank’” after a borrower defaulted on a $650 million loan.

The termination of the Binance.US deal is the second deal to fall through for Voyager, which has been trying to exit bankruptcy and repay its customers for several nine months.

Last September, crypto exchange FTX won an initial auction for Voyager’s assets, only to declare bankruptcy itself two months later.

As PYMNTS’ Karen Webster wrote last fall soon after the FTX crisis began, crypto experts speculated the FTX’s bail out of Voyager — and of fellow crypto firm BlockFi — was a move by founder Sam Bankman-Fried (SBF) to avoid a run on FTX’s FTT tokens and a liquidity crisis.

“What seems clear is that SBF knew then, or should have known, there was trouble brewing,” Webster wrote.

“Which just happened to be at about the same time that the SBF and FTX publicity tour went into high gear, seemingly to boost confidence in both — to bolster the image of the crypto white knight who said he was out to save the day, who said he did so out of the goodness of his heart because no one else could or would step up.”

The court filing says Voyager’s customers will recover 36% of their crypto holdings, about half the rate they would have recovered had the FTX or Binance deals gone through.