Bankrupt Voyager pushes back on what crypto’s ‘white knight’ billionaire says is an attempt to get customers their money back

Voyager customers have had money locked up in the platform since early July, when the crypto platform halted withdrawals and filed for bankruptcy days later. 

Now, Voyager has made it clear exactly how they feel about Bankman-Fried’s offer to bail out their customers.

“It’s a low-ball bid dressed up as a white knight rescue,” the company said in a court filing on Sunday.

The plan, proposed in a Friday letter to Voyager by the parent company of Bankman-Fried’s crypto exchange FTX.com, FTX Trading, along with Alameda Ventures and the parent company of FTX US, West Realm Shires Inc., would allow Alameda Ventures to buy all of Voyager’s digital assets and digital asset loans in cash at a “fair market value,” according to FTX and Alameda’s Friday letter.

FTX would then give Voyager customers part of their frozen funds through its crypto trading platform. Customers would then have the option to immediately convert their funds to U.S. dollars, or use the partial funds to buy more crypto with FTX. Notably, the deal excludes any loan that Voyager gave to failed crypto hedge fund Three Arrows Capital, which reportedly is about $665 million. 

Although the companies’ plan would give customers the option of recovering at least some of their funds before Voyager’s bankruptcy proceedings conclude, Voyager said in its court filing that it amounts to a publicity stunt that will give Voyager customers less than what they could get through the bankruptcy proceedings. 

“Voyager will entertain any serious proposal made pursuant to the Bidding Procedures described in its Motion. It seems clear, however, that AlamedaFTX’s Proposal, which was made in contravention of the proposed Bidding Procedures, was designed to generate publicity for itself rather than value for Voyager’s customers,” the filing reads.

Voyager claims in its filing that FTX and Alameda’s plan would give its customers less than what they could get through the normal bankruptcy proceedings. The FTX and Alameda plan would also disqualify them from receiving anything from the Voyager bankruptcy proceedings if they cash out, according to the letter the companies sent Voyager last week. However, customers “can continue to pursue Three Arrows Capital for additional recoveries,” according to a statement released by FTX Trading last week.

Voyager Digital claims that its own plan of reorganization, filed on July 5, would give customers more by returning all of their customers’ cash and “as much of the cryptocurrency they placed on Voyager’s platform as possible as promptly as possible,” according to Voyager’s Sunday court filing.

“To anyone who reads the Proposal even in a cursory way, it will be obvious that the stand-alone Plan that Voyager filed is capable of delivering far more value to customers than the AlamedaFTX proposal—which transfers significant value to AlamedaFTX, and completely eliminates the value of assets that are of no interest to AlamedaFTX,” the filing reads.

Voyager also argues that the FTX and Alameda plan would further hurt Voyager customers by footing them with a tax bill for converting crypto to U.S. dollars. For customers to cash out any recovered funds, the FTX and Alameda plan would require turning customer’s locked up crypto into dollars, the filing reads, which would leave each customer with a tax obligation caused by the conversion.

“No customer will be made whole under the Proposal, nor will any cryptocurrency be returned to customers under the Proposal,” Voyager wrote in its court filing.

Voyager Digital and FTX did not immediately respond to Fortune’s request for comment.

The plan put forth by the FTX-connected companies, which must be approved by the bankruptcy court before it could go into effect, would be optional, according to FTX and Alameda Research’s Friday letter, and any customer who doesn’t want to participate can wait for the bankruptcy proceedings to continue. However, experts say that could be risky, as Voyager’s customers would be treated as “unsecured creditors” and would be the last to be repaid. 

For his part, FTX founder Bankman-Fried, who has gone on a buying spree as crypto prices fall, says the deal is generous, and that Voyager’s consultants have the most to gain from drawn out bankruptcy proceedings. He said Voyager shouldn’t drag out the process of repaying its customers.

“Anyway: in the end, we think Voyager’s customers should have the right to quickly claim their remaining assets if they want, without rent seeking in the middle. They’ve been through enough already,” Bankman-Fried tweeted on Sunday.”