Voyager Digital Filed for Chapter 11 Bankruptcy. What Does That Mean for Crypto Customers?

Trading of Voyager Digital (OTCMKTS:VYGVF) stock is currently halted after the company announced it will pursue Chapter 11 bankruptcy. The cryptocurrency brokerage also disclosed it has roughly $1.3 billion in crypto assets on its platform. In addition, it has more than $350 million of cash held in its For Benefit of Customers (FBO) account at Metropolitan Bank.

Last week, Voyager announced the suspension of all trading, withdrawals, deposits and loyalty rewards. The company also suspended its debit card, and customers were advised to pause all direct deposits and automatic payments. Voyager attributed the suspension due to losses sustained from the downfall of crypto hedge fund Three Arrows Capital (3AC). 3AC currently owes the crypto brokerage more than $650 million due to a loan default.

So, the big question still remains. What will happen to customer’s assets on the platform?

What Does Chapter 11 Bankruptcy Mean for Voyager Digital Crypto Customers?

Chapter 11 bankruptcy allows the debtor, or Voyager, to remain in business while pursuing a debt reorganization plan. The plan must be in the best interest of the debtor’s creditors, such as Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) and FTX-backed Alameda Research. Still, Voyager has already laid out a plan for what it intends to do with its customers’ assets.