Bankrupt crypto lender Voyager to sell assets to Sam Bankman-Fried's FTX for $1.4 billion

Customers of beleaguered cryptocurrency lender Voyager Digital whitethorn find immoderate solace successful the quality that FTX, the bitcoin speech founded by billionaire Sam Bankman-Fried, is acceptable to instrumentality connected the company's assets aft winning a bankruptcy auction.

After respective rounds of bidding, FTX's U.S. subsidiary was selected arsenic the highest bidder for Voyager's assets, the companies said successful a connection precocious Monday. The bid was valued astatine astir $1.4 billion, a fig that includes $1.3 cardinal for the just marketplace worth of Voyager's integer assets, positive a $111 cardinal "additional consideration" successful anticipated incremental value.

Voyager declared Chapter 11 bankruptcy successful July aft a tumultuous driblet successful integer currency prices near it incapable to redeem withdrawals from its customers. The firm's demise stemmed successful portion from the illness of Three Arrows Capital, a alleged hedge money that took loans from different institutions, similar Voyager, to marque risky gambles connected tokens — including the collapsed stablecoin terraUSD. In June, 3AC defaulted connected borrowings from Voyager worthy $670 million.

Voyager hinted astatine a imaginable modulation of its customers implicit to FTX U.S., saying the speech "will alteration customers to commercialized and store cryptocurrency aft the decision of the Company's section 11 cases." The plus acquisition woody volition beryllium presented to the U.S. Bankruptcy Court for the Southern District of New York for support connected Oct. 19. The merchantability of Voyager's assets to FTX U.S. is babelike connected a ballot by creditors, arsenic good arsenic "other customary closing conditions," according to the statement.

The determination marks a imaginable measurement toward compensating users of Voyager, who person fewer ineligible avenues successful getting paid the crypto they stored connected the level earlier it froze lawsuit withdrawals. In bankruptcy proceedings, customers of crypto platforms are treated arsenic unsecured creditors, meaning they're not really entitled to the crypto they purchased, and similar different creditors would request to spell done the courts to effort to get their wealth back. Creditors of Mt. Gox, which went nether successful 2014, are inactive waiting to get repaid.

Previously, Voyager claimed connected its website and successful selling materials that users' funds were protected by the Federal Deposit Insurance Corporation, but this technically wasn't existent — Voyager's currency deposits are kept with Metropolitan Commercial Bank, a New York-based lender. FDIC security lone covers the lawsuit of nonaccomplishment of the bank, not Voyager. In July, the FDIC and the Federal Reserve sent Voyager a cease and desist letter ordering it to halt claiming it was FDIC-insured.

In the crypto wintertime of 2022, Bankman-Fried has emerged arsenic a savior to galore firms that fell unfortunate to the plunging worth of integer tokens and resulting liquidity issues astatine their platforms. The 30-year-old quant trader-turned-crypto extraordinaire has been shopping for bargains amid the industry's caller carnage.

In July, FTX signed a woody that gives it the enactment to bargain lender BlockFi aft providing a $250 cardinal enactment of credit. Bankman-Fried says helium inactive has plentifulness currency to walk connected further deals. And helium whitethorn soon person adjacent more, with sources telling CNBC FTX is raising different $1 billion from investors successful an upcoming financing round.

- CNBC's Kate Rooney contributed to this report