Bankrupt cryptocurrency firms FTX Trading and Voyager Digital Holdings have reached a settlement agreement to resolve loan disputes, facilitating the repayment of creditors.
After lengthy legal battles, both parties finalized the agreement on Tuesday, paving the way for Voyager to receive the full $445 million owed, including accrued interest. Voyager’s financial woes were exacerbated by the collapse of crypto hedge fund Three Arrows Capital (3AC), to which it had lent a significant portion of its holdings.
FTX, facing its own bankruptcy proceedings, sought approval from a Delaware court for the deal, emphasizing its comprehensive resolution of all claims and disputes between the two companies.
The origin of the conflict traces back to a cryptocurrency loan extended by Voyager to Alameda Research Ltd., an FTX subsidiary, in October 2021. Subsequently, Alameda and FTX initiated legal action against Voyager to recover loan repayments, prompting Voyager to file counterclaims against FTX.
Following the settlement, both firms have agreed to cease further litigation against each other, subject to specified conditions outlined in the court filings.
The resolution offers a ray of hope for Voyager creditors, signaling the imminent release of $450 million, plus interest, for distribution. This second distribution, expected in the coming months, promises relief to investors who have had their assets tied up on the platform.
Legal counsel for Voyager expressed satisfaction with the outcome, highlighting its favorable implications for creditors compared to protracted litigation. However, they cautioned against fraudulent activities targeting Voyager creditors and assured that measures have been implemented to address such instances.