Sam Bankman-Fried Led FTX Wins Bid To Acquire Voyager Digital’s Assets

The FTX bid is valued at $1.4 billion, according to a Voyager press release. FTX competed with Wave Financial, a company that invests in digital assets.

With FTX winning the auction to buy the assets of the troubled crypto lender, the Voyager Digital saga appears to be coming to an end. As stated in a statement made by Voyager Digital, FTX made the highest offer, valued at $1.4 billion. A two-week long, fiercely competitive auction was held for the lender’s assets.

The fair market value of Voyager’s cryptocurrency holdings at an unspecified time was one component of the FTX bid. This sum is estimated to be around $1.311 billion at the current market price. A projected incremental value of $111 million has also been taken into account. The announcement stated that creditors would be paid out of the Voyager bankruptcy estate, which also includes claims against Three Arrows Capital (3AC).

The asset purchase agreement between FTX US and Voyager Digital will be submitted to the United States Bankruptcy Court for the Southern District of New York on October 19, 2022, for approval now that the bid has been accepted. Before October 12, 2022, any objections to the transaction must be filed. The agreement will be approved by a chapter 11 plan, subject to a creditor vote and other closing requirements, if there are no objections to the deal.

Voyager Digital declared bankruptcy in July after the company’s business practices drew intense scrutiny from industry observers. One claim, in particular, caught the attention of observers when the company stated in its marketing materials that investor deposits were insured by the FDIC (Federal Deposit Insurance Corporation).

The FDIC insures bank-held cash deposits up to $250,000. The catch is that it does not apply to cash converted to stablecoins. Furthermore, Voyager’s loan book accounted for nearly half of the company’s assets, with nearly 60% of the loan book made up of loans to Three Arrows Capital, which had also declared bankruptcy in July.

Bankman-Fried has publicly stated that FTX plans to spend billions on the acquisition of businesses in the crypto space as it takes advantage of the bear market to go on an acquisition spree. The exchange is planning to spend heavily during the bear market and has already completed several acquisitions. Additionally, FTX has said that it will keep funding cryptocurrency projects even if their failure has broader repercussions for the industry.

In actuality, FTX had previously made several attempts to save Voyager. A joint offer for Voyager had been made by FTX and Alameda, which the crypto lender swiftly rejected. According to a source close to FTX and familiar with the transaction, FTX is currently raising a $1 billion funding round.

Image Credit: Shutterstock