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Voyager’s Bankruptcy | Consumer Protection Attorneys


On July 5, 2022, Voyager Digital Holdings, Inc (“Voyager”) filed a voluntary petition for relief under chapter 11 of the Bankruptcy Code in the Southern District of New York (Case Number: Case No. 22-10943).

Dilendorf Law Firm attorneys navigate account holders regarding their rights in Voyager’s Chapter 11 bankruptcy proceeding.

Voyager’s Account Holders have been classified as General Unsecured Creditors under Chapter 11 of the Bankruptcy Code, which goes against the company’s fiduciary duty to hold users’ assets in separate escrow accounts.

General unsecured claims have a lower priority, and these unsecured claims may not be paid until the higher priority claims are paid in full.  Furthermore, general unsecured claims are generally dischargeable – this means that any amount that is not paid through the bankruptcy proceeding is erased and debtor is no longer liable on the debt.

Voyager’s Customer Agreement, updated January 7, 2022 and Risk Disclosure Statement did not disclose that in the event of insolvency or bankruptcy, customers’ digital assets may be considered property of the bankruptcy estate and that customers could be treated as general unsecured creditors. 

The Company filed a Chapter 11 restructuring plan (“Plan”) – see below.  The plan must satisfy the Best Interests of Creditors Test required under Section 1129(a)(7) of the Bankruptcy Code and the settlement must be “Fair and Equitable” regarding Voyager’s Account Holder Claims.



Advising Voyager's account holder, with $3.5M of frozen digital assets, in respect to his Chapter 11 creditor's rights and filing a proof of claim with the bankruptcy court

Our Team Can Assist You With:

  • Submitting a Proof of Claim to preserve your legal rights for repayment.
  • Conducting a Fact finding Feasibility Study to collect all information from you and review all the documents you have in connection with your investments and loans.
  • Evaluate legal theories and procedural techniques that could potentially be used to protect and further your interests and claims, including but not limited to you being deemed a “secured creditor” and establishing a Creditors’ Committee.
  • Monitoring the initial phase (about the first 1-2 months) while communicating with the Bankruptcy Court and other counsel and engaging in all necessary activities involved in your representation.
  • Handle all other aspects of the proceeding and advocate in and out of the courtroom on your behalf, including but not limited to legal research and settlement.

Filing Proof of Claim

A proof of claim is a document that a creditor files with the bankruptcy court to assert their rights of repayment from the debtor.

Most importantly, a properly and timely filed proof of claim will supersede any scheduling of claims by the debtor in the Chapter 11 Bankruptcy reorganizations.

Generally, any creditor whose claim is scheduled as disputed must file a proof of claim in order to be treated as a creditor for purposes of voting on the plan and distribution under it.

Our firm can assist you with processing and filing a Proof of Claim to protect your rights.

Voyager’s Restructuring Plan & Account Holder Claims

Voyager’s Chapter 11 restructuring Plan provides for a standalone restructuring transaction that can be effectuated without a sale or a strategic partner.  Under the Plan:

  • Account-holders claims are listed “General Unsecured Claims” which are generally dischargeable in bankruptcy if not paid in full. General unsecured claims are only entitled to payment after all priority claims are paid in full and often only receive a small percentage recovery.
  • Account-holders will receive a pro rata share of (i) a to be determined percentage of the specific cryptocurrency held by such account holder, (ii) 100% of new common shares in reorganized Topco (subject to dilution by a management incentive plan), (iii) the existing Voyager tokens and (iv) any recovery on account of the 3AC loan.
  • The Plan will provide a mechanism by which each individual account holder may elect to increase (decrease) its pro rata share of new common shares in reorganized Topco in exchange for a decrease (increase) in its pro rata share of coins, subject to certain maximum participation thresholds.
  • Holders of Allowed General Unsecured Claims are entitled to vote to accept or reject the Plan.

Whether Voyager’s Plan Satisfies The Best Interests Test of Account Holders

Section 1129(a)(7) “is one of the cornerstones of chapter 11 practice.” 7 COLLIER ON BANKRUPTCY ¶ 1129.02[7] 1129-33 (16th ed. 2014). It states that with respect to “each impaired class of claims,”

(A) each holder of a claim or interest of such class—

(i) has accepted the plan; or

(ii) will receive or retain under the plan on account of such claim or interest property of a value, as of the effective date of the plan, that is not less than the amount that such holder would so receive or retain if the debtor were liquidated under chapter 7 of this title on such date . . .

Voyager has the burden of demonstrating that Plan satisfies the “best interest” test. See, e.g., In re GSC, Inc., 453 B.R. 132, 179 n.66 (Bankr. S.D.N.Y. 2011).

That test “focuses on individual creditors rather than classes of claims . . . [and] requires that each holder of a claim or interest either accept the plan or receive or retain property having a present value, as of the effective date of the plan, not less than the amount such holder would receive or retain if the debtor were liquidated under Chapter 7.” In re Drexel Burnham Lambert Grp., Inc., 138 B.R. 723, 761 (Bankr. S.D.N.Y. 1992).

It’s questionable whether Voyager have satisfied the best interest test and why it listed customers’ accounts as “General Unsecured Claims” when Voyager’s customer agreement and risk disclosure statement failed to disclose customer’s rights in case of a bankruptcy.

Voyager’s Plan could be impaired.  Section 1124(1) provides that a claim is impaired unless the plan “leaves unaltered the legal, equitable, and contractual rights to which such claim or interest entitles the holder of such claim or interest.”

Section 1126(f) of the Bankruptcy Code, 11 U.S.C. § 1126(f), provides that classes that are not impaired by a chapter 11 plan are deemed to have accepted it.

Chapter 11 creditors have a fundamental right to have a meaningful voice in the plan-confirmation process, either by accepting the chapter 11 plan or bringing to the court’s attention any concern that it may have regarding any aspect of the bankruptcy case.

Whether Voyager’s Plan is Fair and Equitable

If Voyager’s customer vote against the Plan, it can only be confirmed by the Bankruptcy Court if it is “fair and equitable” to them.  Section 1191(b).

The plan generally must provide for “all of the projected disposable income of the debtor” over the life of the plan be paid into the plan or else that “the value of the property to be distributed under the plan” should not be less than the projected disposable income amount. Section 1191(c)(2).

Voyager Has:

  • Over $110 million of cash and owned crypto assets on hand;
  • $350 million of cash held in the For Benefit of Customers (FBO) account at Metropolitan
    Commercial Bank;
  • Approximately $1.3 billion of crypto assets on platform; and Claims against Three Arrows Capital of more than $650 million.

Additionally, Voyager is facing several legal and operational challenges, including:

  • Attempts by several states to terminate the Company’s money transmitter licenses.
  • Unauthorized ACH transfers

Voyager’s Restructuring Process

Voyager’s Customer Agreement

Voyager’s Customer Agreement updated January 7, 2022 and Risk Disclosure Statement  did not disclose that in the in the event of insolvency or bankruptcy, customers’ digital assets may be considered property of the bankruptcy or insolvent estate such that customers will be treated as general unsecured creditors.

Voyager’s Crypto Custody

Voyager holds the cryptocurrency through one of its approved crypto custodians. Voyager utilizes third-party custodians such as Coinbase Trust Company, LLC,, and Anchorage Digital, or self-custody solutions such as Fireblocks, among others.

Can Voyager Customer Sell its Unsecured Claim?

Yes, absolutely.  If you are holding Voyager’s “General Unsecured Claim”, you may wish to consider the option of selling the claim to a third party at discount to secure some guaranteed recovery rather than wait until the conclusion of the case and the distribution, if any, to holders of such claims.

Case No. Debtor Name
22-10943 Voyager Digital Holdings, Inc.
22-10944 Voyager Digital Ltd.
22-10945 Voyager Digital, LLC

Court Information

United States Bankruptcy Court
Southern District of New York

One Bowling Green
New York, NY 10004-1408
Phone: 212.668.2870


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