Australian cryptocurrency exchange Digital Surge is set to make a comeback after a successful recovery plan was signed by stakeholders on Feb. 15, just one day before the exchange was set to go into liquidation, reports say.
The news has come as a relief to Digital Surge’s 22,545 customers who had more than $0.01 cent in their account at the time the company went into administration in December last year.
According to documents submitted to the Australian Securities and Investments Commission (ASIC), the creditors were notified of the news earlier today through a circular, and the exchange is expected to resume trading next week.
This marks the first successful restructuring of an Australian cryptocurrency exchange, a significant achievement, according to Michael Bacina, digital asset specialist and partner at Piper Alderman.
The Brisbane-based exchange faced significant challenges after transferring $33m worth of assets to FTX just two weeks before the company’s spectacular collapse in November. The collapse of FTX hit Digital Surge hard, and the exchange went into administration in December, leaving customers worried about their investments.
The situation seemed dire until the second meeting of creditors, which lasted over four hours on Tuesday. As was reported by Cryptotale, creditors ultimately agreed to a plan proposed by Digico and Digital Surge directors Daniel Ritter and Joshua Lehman, which will see Digico loan $1.25m to Digital Surge to keep the company running.
Under the recovery plan, customers with under $250 in their digital wallets will be repaid in full, while the remainder will receive 55% of their balance in the next few months.
Customers will be paid in cryptocurrency or regular currency, depending on how much they have of each. The rest will be paid back over the next five years in regular currency out of any quarterly profits Digital Surge makes.
