Banking

Voyager lenders Voyager lenders balk at resistance for crypto loan provider’s officers

Voyager Digital Ltd. lenders are disagreing with strategies to supply the crypto loan provider’s directors and officers with resistance from claims connected to its descent into insolvency. 

The business’s pending sale to the crypto exchange huge FTX seems conditioned on Voyager’s magnates being paid for “broad releases” from claims, securing those “principally responsible” for the company’s monetary issues, attorneys for Voyager’s main committee of unsecured lenders stated in court documents submitted Wednesday. 

An examination by the lenders into the situations around Voyager’s insolvency exposed “sobering” findings, however the releases would avoid claims versus the directors and officers in concern from being pursued, according to the lender group. Details of the examination are edited from the insolvency court filings.

This leaves the lenders with a “Hobson’s choice” — either support the securities to rapidly get the sale to FTX over the goal, or danger expensive hold-ups as the Chapter 11 procedures become a “morass of litigation,” composed the attorneys. 

Two members of Voyager’s board of directors are likewise examining the run-up to the insolvency, consisting of the loan to now-defunct hedge fund Three Arrows Capital that taxed the business. If those board members conclude that specific Voyager executives might or must be taken legal action against, those individuals would be left out from the proposed releases, court documents reveal. 

Voyager must be required to much better discuss the requirement for securing the executives, the lender group argues. Lawsuits versus them, if effective, might assist get Voyager users more of their refund. 

An agent for Voyager decreased to comment. 

The insolvency is Voyager Digital Holdings Inc., 22-10943, U.S. Bankruptcy Court for the Southern District of New York (Manhattan).

Gabriel

A news media journalist always on the go, I've been published in major publications including VICE, The Atlantic, and TIME.

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