FTX pitches plan to get Voyager customers some of their money

Customers locked out of their accounts from the Voyager Digital bankruptcy could get quicker access to part of their claims under a new proposal from FTX and Alameda Ventures.

The firms, both run by crypto billionaire Sam Bankman-Fried, announced the plan Friday. Under the joint proposal, customers of Voyager could start a new account with FTX with an opening cash balance funded by an early distribution of their bankruptcy claims. Customers could either withdraw the cash immediately or use it to purchase digital assets through FTX.

The plan would require approval from the bankruptcy court overseeing Voyager's case. It would be optional for customers, the firms said, as some may wish to instead pursue their claim through the courts.

Because crypto deposits lack the regulatory protections of traditional banks and brokerages, customer assets held by Voyager could be considered part of the company's bankruptcy estate, with those customers given a low priority to recover them as unsecured creditors.

"Voyager's customers did not choose to be bankruptcy investors holding unsecured claims," Bankman-Fried said. "The goal of our joint proposal is to help establish a better way to resolve an insolvent crypto business — a way that allows customers to obtain early liquidity and reclaim a portion of their assets without forcing them to speculate on bankruptcy outcomes and take one-sided risks."

In a letter to Voyager's attorney posted online Friday, FTX and Alameda described the plan as requiring a two-pronged transaction:

Alameda will purchase all Voyager digital assets and digital asset loans (other than the loans to Three Arrows Capital ('3AC'), discussed below) in immediately available cash at fair market value. Alameda would pay the cash value of Voyager’s digital assets into escrow; and FTX (or an applicable subsidiary thereof) will offer those Voyager customers who on-board with FTX the ability to receive their share of that cash in an account at FTX. Customers could withdraw their cash without gates or lockups or, if they choose, re-invest it in digital assets of their choice. FTX would waive the first month of trading fees for Voyager customers who wish to purchase digital assets rather than withdraw their cash.

Alameda would also write off a $75 million loan claim. The firm would not purchase any claims related to the collapsed hedge fund Three Arrows Capital, describing the ongoing Chapter 11 proceeding as "the best place to pursue recoveries relating to Voyager’s loan to 3AC."

Some customers have dollar balances held in accounts on Voyager's behalf at Metropolitan Commercial Bank. "We are open to including or excluding these accounts from the transaction, as best for customers," the FTX letter said.

FTX hopes to close the transaction by mid-August, it said.