Regulation
FTX, Voyager Secure $450M Settlement in Bankruptcy
FTX and Voyager Digital have secured a $450 million settlement. The agreement, sanctioned by Judge John Dorsey of the United States Bankruptcy Court for the District of Delaware, aims to settle all claims between the two firms. This settlement is part of Voyager’s ongoing efforts to repay creditors following its bankruptcy filing in July 2022.
The terms of the deal were detailed in a court filing on April 29. They include the release of $5 million currently held in escrow by Voyager and an additional $445 million tied to a loan repayment lawsuit from Alameda Research. With this settlement, FTX will relinquish all rights to the funds, facilitating a clearer path for Voyager’s debt repayment strategy.
Both Voyager’s attorney, Paul Hage, and FTX restructuring officer, CEO John Ray III, have formally approved the settlement terms as of April 4. This marks a critical step forward in addressing the claims and financial obligations arising from Voyager’s bankruptcy proceedings.
Voyager Customers to Recover 35.7% of Claims
Voyager Digital’s path to compensating its creditors has included multiple significant settlements and claims. In April, the company secured approximately $20 million from Three Arrows Capital and about $14 million from Directors and Officers Insurance. These funds are part of a broader strategy to manage and distribute assets to affected parties.
A restructuring plan proposed in May 2023 suggested that Voyager customers might recover 35.7% of their claims, whether in crypto or fiat currency. This plan is part of a series of measures designed to stabilize the firm’s financial standing and provide restitution to its users and investors.
Genesis, Gemini Settle with SEC for $21M
The settlement comes amid ongoing legal challenges for entities within the cryptocurrency market. Notably, in October 2023, the U.S. Commodity Futures Trading Commission and the Federal Trade Commission filed lawsuits against Voyager’s former CEO, Stephen Ehrlich. These lawsuits address allegations of fraudulent statements made by Ehrlich, and the cases were still pending at the time of this report.
Additionally, a related lawsuit involving Genesis and Gemini culminated in a $21 million settlement with the SEC. This settlement, approved by a New York federal judge, pertains to charges that Genesis Global Capital sold unregistered securities through the Gemini Earn program. The SEC will receive the penalty upon the bankruptcy court’s confirmation of all claim payments, including those to retail investors involved in the program.
Read Also: US SEC Slammed By Lawmaker Over Misleading Ethereum Security Tag
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
Legal expert Fred Rispoli has stated that Ripple has a better chance of winning the US Securities and Exchange’s (SEC) appeal in their lawsuit if an unbiased panel is sitting on the case. However, he claimed that the Commission would likely have a 70% to 80% chance of winning if the Judges who sit on the case have a long history of agreeing with the government.
How Ripple Could Defeat The SEC
In an interview on the Thinking Crypto podcast, Rispoli mentioned that the odds would be 70% to 30% in favor of Ripple if the 2nd Circuit Court of Appeal Judges were unbiased. The lawyer noted that the “sad part” about the probabilities of who will win is that it hinges on who the three Judges that get assigned the case are.
CoinGape reported that the US SEC is appealing Judge Analisa Torres’s final judgment on August 7. However, the XRP community has continued questioning whether the appeal will only apply to the $125 million penalty or extend to Judge Torres’ ruling on the programmatic sales last year.
Fred Rispoli gave his opinion, stating that the SEC will likely appeal everything. He noted that the notice of appeal was about the summary judgment and not just the penalty ruling. As such, the Commission can appeal any of the rulings included in the summary judgment.
The legal expert believes that the Commission will focus on programmatic sales, which involves Judge Torres ruling that XRP isn’t a security in itself. He added that they will also seek a higher fine than the $125 million that Judge Torres awarded.
Fred Rispoli noted that the 2nd Circuit’s potential ruling on programmatic sales is most important for XRP holders and the broader crypto community. According to him, the SEC will move to cite the court’s ruling on its case against crypto firms like Binance, Coinbase, and Kraken if the court rules in the Commission’s favor on the programmatic sales.
How The SEC Could Lose It All
Fred Rispoli cited a scenario in which the 2nd Circuit could overturn Judge Torres’s rulings in favor of the SEC. He claimed that this would happen if Ripple got a really good panel. The lawyer also alluded to Ripple’s Chief Legal Officer (CLO) Stuart Alderoty’s comments that they intend to file a cross-appeal.
The legal expert remarked that it would be “foolish” if the crypto firm didn’t file a cross-appeal. He claimed that a cross-appeal would further solidify the company’s 70% chance of winning the appeal as the court will likely reach a “split the baby decision” if this happens. Rispoli explained that this means that the 2nd Circuit will decide to affirm all Judge Torres’ rulings rather than give a different opinion.
Meanwhile, the lawyer predicts the case will likely continue until at least January 2026. This aligns with the timeline for both parties to file their court processes. For instance, he stated that the SEC would likely not file its opening brief until December of this year. After that, he expects Ripple’s reply brief won’t come until March.
Therefore, the lawyer believes the crypto firm should push forward on the legislative front, considering how long the case could take. However, he noted that the good thing is that Judge Torres’ ruling on XRP not being a security remains the law of the land until regulatory clarity or a ruling is made in the appeal.
The Ripple SEC lawsuit negatively impacted the XRP price in the 2021 bull run as the Commission instituted the lawsuit in December 2020. However, crypto analyst Egrag Crypto predicted that the XRP Price will cross $5 despite the SEC appeal.
Boluwatife Adeyemi
Boluwatife Adeyemi is a well-experienced crypto news writer and editor who has covered topics that cut across DeFi, NFTs, smart contracts, and blockchain interoperability, among others. Boluwatife has a knack for simplifying the most technical concepts and making it easy for crypto newbies to understand. Away from writing, He is an avid basketball lover and a part-time degen.
Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
- Transak secures its first Money Transmitter License (MTL) in Alabama.
- The license boosts security, speed, and compliance for US cryptocurrency services.
- Transak targets further state licenses as it enhances its Web3 payments infrastructure.
On October 3, 2024, Transak USA LLC achieved a significant milestone by securing its first Money Transmitter License (MTL) from the Alabama Securities Commission.
This regulatory approval positions Transak as a fully licensed financial institution in the state, a key step in its mission to provide secure and accessible cryptocurrency services across the United States.
Transak expanding its foothold in the US
The Alabama MTL solidifies Transak’s commitment to regulatory compliance, underscoring the company’s efforts to build a secure and transparent infrastructure for crypto transactions in the US.
With cryptocurrency purchases already enabled in 46 states, the company is actively working to secure additional licenses across the country. This proactive approach highlights Transak’s determination to make cryptocurrency widely accessible and compliant with stringent financial regulations.
As a registered Money Service Business with FinCEN, Transak’s new license is a significant trust signal for its users. It allows the company to provide enhanced security, faster transactions, and a more seamless user experience for crypto purchases in Alabama. The move also benefits decentralized platforms integrated with Transak’s services, enabling them to offer their users a smoother and more compliant crypto purchasing experience.
Bryan Keane, the Compliance Officer at Transak, remarked, “Obtaining the Money Transmitter License in Alabama showcases our commitment to compliance and our mission to make cryptocurrency accessible and secure for everyone.”
In the same breath, Sami Start, the CEO of Transak, emphasized the importance of the US market, stating, “Securing state licenses like this one is essential to delivering the best possible services here.”
With over 5.7 million users across 160 countries, Transak continues to expand its presence as the largest Web3 payments infrastructure provider. Headquartered in Miami, with additional offices and tech hubs globally, Transak remains focused on obtaining more state licenses in the US, ensuring its users enjoy an increasingly reliable and legally compliant crypto experience.
The Alabama MTL marks a major step forward for Transak as it strengthens its foothold in one of the world’s most regulated and lucrative markets.
- CFTC’s subcommittee recommends using DLT-based collateral in trading.
- Approval could broaden access to digital assets for smaller market participants.
- Strong ETF inflows signal growing institutional interest in digital assets.
In a significant development for the digital assets market, the US Commodity Futures Trading Commission (CFTC) is reportedly considering a proposal that would enable the use of digital ledger technology (DLT)-based collateral in commodities and derivatives trading.
According to Bloomberg, a subcommittee of the CFTC’s Global Markets Advisory Committee recently voted to recommend this proposal, which, if approved, could streamline transactions and promote broader adoption of digital assets in traditional finance.
A step toward mainstream adoption
If the proposal receives final approval from the main committee, it could lead to a paradigm shift in how trading collateral is managed.
The adoption of DLT-based collateral would allow traders to settle transactions using digital assets with the same speed and efficiency that digital ledger and blockchain technology offers.
This change would enable brokers to accept tokenized assets, such as BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL) token, through market-embedded systems.
While the use of blockchain-based assets as collateral is already gaining traction among major financial institutions like BlackRock and JP Morgan, the CFTC’s potential approval would catalyze broader adoption across the industry.
As it stands, only large firms have been able to utilize these innovative financial instruments, but this move could open the doors for smaller market participants to access similar benefits.
Uncertainty ahead
Despite the positive momentum surrounding the proposal, several steps remain before it can be formally submitted for CFTC approval. The main committee must first review and endorse the subcommittee’s recommendation, and there are no guarantees that the CFTC will approve the proposal in its current form.
Regulatory concerns may arise regarding which institutions and blockchains are permitted to participate, which could introduce potential restrictions that may limit the scope of the initiative.
Furthermore, the broader context of digital assets in traditional finance cannot be ignored. Recent trends, such as strong inflows into spot Bitcoin exchange-traded funds (ETFs), indicate a growing acceptance and interest in digital assets among institutional investors.
For instance, BlackRock’s Bitcoin ETF has recently outperformed its peers, witnessing the highest daily inflow of any fund on September 25, marking a five-day streak of inflows across all spot Bitcoin ETFs in the United States.
This surge in interest may influence the CFTC’s decision-making process as they consider the implications of allowing digital assets as collateral.
As this unfolds, stakeholders will be watching closely as the regulatory landscape continues to evolve, potentially paving the way for a more integrated future for digital assets in commodities and derivatives trading.
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