Justin Sullivan | Getty Images
Binance and other crypto firms are preparing takeover offers for beleaguered cryptocurrency lender Voyager Digital after FTX, which had initially agreed to take over the company, filed for bankruptcy.
Voyager filed for Chapter 11 bankruptcy protection, which seeks to restructure ailing companies as viable business operations, in July after crypto hedge fund Three Arrows Capital defaulted on a $670 million loan from the company.
Voyager is set to be acquired by FTX’s US unit, FTX US, for $1.4 billion after Sam Bankman-Fried’s company won a US bankruptcy auction. Then it was put back to square one after FTX itself filed for bankruptcy after seeing a spike in bank-style withdrawals.
Voyager customers have not been able to get their money out since it paused withdrawals amid an industry-wide liquidity crisis.
This week, Binance confirmed reports that its US subsidiary Binance.US is planning to bid to save Voyager from collapse. Binance.US previously offered to buy Voyager as part of its bankruptcy auction.
Speaking on Bloomberg, Binance CEO Changpeng Zhao said that Binance.US will “make another bid for Voyager now that FTX can no longer follow through on that commitment.”
Zhao has also set up a $1 billion fund aimed at supporting struggling companies in the industry.
CrossTower, a Crypto and NFT trading platform, was among the parties that initially competed to purchase Voyager in the court auction. The company says it plans to make a rolling bid for the company — though details are scarce at the moment.
A CrossTower spokesperson told CNBC via email that CrossTower is “offering a revised offer, one that it feels will benefit both customers and the broader crypto community.”
CrossTower is also planning a separate industry recovery fund. The company told CNBC that it does not view the fund as a “competitor” of Binance funds.
“This is about stabilizing the industry, restoring confidence, and rebuilding what is arguably the future of finance,” said a Cross Tower spokesperson.
“We will do this, with money and talent, and we will partner with governments and policymakers and promote transparency. One investment fund has not built the tech industry and one recovery fund is not going to rebuild that fund.”
Meanwhile, Wave Financial is also planning to make a new takeover bid for Voyager, after it initially lost out to FTX, according to a report from London’s Financial News.
Matteo Perocchio, Wave’s international president, declined to comment on the report when contacted by CNBC via WhatsApp. Last month, Perocchio told CNBC of his company, “I felt like our offer was better for both investors and debtors.”
Wave’s offering “made us reinvigorate VGX,” Voyager’s exchange token, he said in an October interview.
Voyager customers hope that any bailout of the company will include VGX, a token created by Voyager as a kind of loyalty rewards program, which offers discounts on trading fees.
“We also had some smart ideas, I think, about how to bring in traffic at a much lower CPA at a higher price per customer, which are the two big problems with Voyager,” Perocchio told CNBC in October.
In August, Voyager temporarily halted trading and transfers of VGX and laid out a plan for customers to exchange their tokens for new coins on a separate blockchain. The fate of the token, which has fallen more than 85% since the beginning of the year, remains unclear.
FTX US has offered to buy all VGX held by Voyager and its subsidiaries for $10 million. But Voyager said it is working on a “better and better solution” for the tokenization that matches FTX US’ offering.
FTX US is now part of the bankruptcy proceeding in a Delaware state court, along with its parent company and other subsidiaries including Alameda Research. The company’s bid was initially rejected by Voyager, which called it “a low-ball proposal dressed as saving the White Knight”.
Another player involved in the messy restructuring is Ethos.io, a startup that Voyager acquired in 2019. Voyager only acquired Ethos.io technology, and the company plans to revive itself as a separate brand after Voyager collapses.
Shingo Lavine, co-founder of Ethos.io, says his company’s technology has been key to helping Voyager build its encryption capabilities. He added that Voyager experienced significant growth after introducing support for dogecoin, a meme-inspired digital currency.
Adam Levine, Shingo’s father and fellow Ethos.io co-founder, said the company has created its own recovery program for VGX owners and Voyager creditors and has “seen a good response so far across the Voyager community.”
So far, “several thousand users representing 10% of the total VGX synthesizer market value” have signed up for the recall initiative, the elder Lavigne said. Voyager was not immediately available for comment when contacted by CNBC.