Crypto lender Voyager Digital recently allowed its investors to withdraw funds, marking a significant development after the company had previously suspended withdrawals and filed for Chapter 11 bankruptcy.

Since the resumption of withdrawals, creditors have been racing to withdraw their funds from the Voyager Digital platform.

The withdrawals have resulted in an outflow of over $250 million worth of crypto assets from the platform, presenting a challenging situation for the company.

According to data from Dune Analytics, Voyager Digital has experienced an outflow of over $250 million in crypto assets due to the rapid withdrawal requests from creditors.

This follows the financial downfall of the Terra ecosystem, which had a severe impact on Voyager Digital, leading to its bankruptcy declaration and substantial losses for investors.

After obtaining court approval, Voyager Digital’s bankruptcy plan went into effect. As per the plan, customers are entitled to receive 35.72% of their claims as an initial payout.

However, the situation becomes more complex for institutions like Three Arrows Capital, which owes Voyager $650 million.

The distribution of funds to creditors faces uncertainty, as the resolution of Alameda Research’s preference claim against Voyager is expected to take time, potentially until mid-September 2023.

There is a possibility of an additional $445 million becoming available to creditors, but this is contingent on the resolution of the preference claim.

While Voyager Digital allows withdrawals, the company is actively engaged in asset recovery efforts to repay creditors. Currently, the platform holds $176 million worth of crypto assets, with Bitcoin (BTC) and Ethereum (ETH) constituting the majority.

The committee representing unsecured creditors has incurred significant legal fees, totaling around $16.5 million. The recovery process has encountered obstacles, including the intervention of US government agencies that halted a bid by Binance to acquire Voyager for $1 billion.