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A battle between  Sam Bankman-Fried, who has launched a white knight effort for Voyager Digital's customers, and the crypto lender's bankruptcy  team at Kirkland & Ellis is officially on. 

Why it matters: Whether SBF succeeds  could have a significant impact on how Voyager navigates the Chapter 11 restructuring process, and on how it handles customer accounts. 

Catch up quick: On Friday, global crypto exchange FTX (where SBF is co-founder and CEO) made an offer to bail out Voyager's customers.

On Sunday, Voyager's bankruptcy lawyers filed a response, calling the proposal "a low-ball bid dressed up as a white knight rescue.” 

On Monday: FTX's communications team sent an official SBF response to Ryan, saying:

"We submitted what we think is a generous proposal — we aren't taking fees on this, just letting customers get their remaining assets back promptly."

He added that it's a voluntary bid and that customers can take his company's offer or continue through Chapter 11. 

"It appears that Voyager's consultants are attempting to stall out the process, increasing their fees. We feel for the customers who have lost significant funds and are waiting to receive those that remain," the response concluded. 

The proposal: SBF's offer was made jointly with FTX owner West Realm Shires Inc., along with his investment firm Alameda Ventures. It offered Voyager customers the ability to start an FTX account with an opening balance funded by an early distribution on a portion of their bankruptcy claims.

Of note: FTX and Alameda were careful to acknowledge that they were not looking to bail out Voyager from loans made to Three Arrows Capital or other creditors. 

But as part of the proposal, they said Alameda would write off a $75 million unsecured loan it had made to Voyager before the latter firm filed for bankruptcy.  

Yes, but: Voyager doesn't seem very interested in the offer. At all. 

The company, in a legal filing by Kirkland & Ellis, said it "will consider any serious proposal" that is better for customers than FTX's and that the move is an attempt to subvert the bankruptcy process. 

What we're watching: What the Chapter 11 bankruptcy court thinks of the customer bailout offer. 

1 big thing: FTX's Voyager offer declared un-generous

Illustration of a pitchfork spearing a digital coin with pieces falling away

Aptos Labs, a blockchain startup founded by former Meta employees, raised $150 million in Series A funding led by FTX Ventures (another SBF entity) and Jump Crypto.

Why it matters: The deal shows that investors are plenty hungry for a project that can fulfill the broader blockchain ecosystem's unrealized promises — and for talent that came out of Meta’s Diem/Novi project, despite its ultimate failure.

Background: Aptos Labs is building a so-called Layer 1 blockchain intended to lower fees and speed up transactions, while creating a more secure environment.

Mo Shaikh and Avery Ching — who both worked on Meta’s Novi blockchain project — founded the company in December.

The project draws on "key elements of the Diem blockchain and its smart contract language Move."

Details: The last round of funding valued the young business at more than $1 billion. Aptos has now raised over $350 million in its lifetime.

Investors in this round (which includes Apollo, Griffin Gaming Partners, Franklin Templeton, Circle Ventures, Superscrypt founded by Temasek) have doubled the valuation.

Aptos will launch more broadly later this year, using the funds to hire as well as invest in developers in its ecosystem.

Bottom line: Aptos bears the yoke of high expectations. 

2. The BFD: Aptos doubles its valuation

Illustration of a pattern of hands trading tokens.

They thought ‘crypto banks’ were safe, and then came the crash (WSJ)

Customers are getting a hard lesson in an age-old markets maxim: Reaching for yield usually comes with big risk.

BlockFi had $600M in crypto loans not covered by collateral (Decrypt)

According to the company’s “Q2 2022 Transparency Report,” released Friday, BlockFi held an institutional and retail loan portfolio totaling $1.8 billion, with $1.2 billion in loan collateral. 

TrueAccord cited for collecting on illegal tribal loans (Fintech Business Weekly)

The digital debt collection startup entered into a consent order with the Connecticut Department of Banking to resolve charges it violated state law by collecting on small-dollar, high-APR loans originated by lenders affiliated with federally recognized Native American tribes. 

The crypto boom runs on hype men like ‘BitBoy’ (WaPo)

 Ben Armstrong (a.k.a. Bitboy_Crypto) is a leading example of a crypto influencer. One-part media personality, one-part untrained investment adviser, he wields significant power in the world of cryptocurrency investment, steering tip-hungry online trawlers to the latest token.

CFPB takes a deeper look at earned-wage access (the Protocol)

Far more active in this administration than the last, the CFPB is taking a deeper look at whether earned-wage access products should be more stringently regulated, as loans are.

3. Credit score

Illustration of a Scrabble board with letter tiles spelling "credit."

• Shares, a European investment app, raised $40m in new funding led by Valar Ventures. Global Founders Capital and Singular also participated. Read more.

• Cartona, an Egypt-based startup providing inventory management and working capital to small retailers, raised $12m in Series A funding led by Silicon Badia, with participation from the SANAD Fund for MSME, Arab Bank Accelerator and Sunny Side Ventures. Read more.

• HeveaConnect, a Singapore-based, agri-commodities platform company, raised $7.1m in Series A funding led by Provident Capital Partners and DeClout Ventures. heveaconnect.com

• Copper, a crypto prime brokerage startup, raised an undisclosed amount of funding from Barclays, Sky News reports. Read more.

• FTX, a global crypto trading firm, is in advanced talks to buy South Korea’s Bithumb, Bloomberg reports. Read more.

• Chain, a blockchain infrastructure startup, acquired the Measurable Data Token (MDT) and its ecosystem products for $100m. Read more.

4. Deals of the day

• Curve, a financial super app, hired Eyal Galina as its new chief product officer. Read more.

• Bank of Montreal hired investment banker Laura Holden from Raymond James and appointed Lech Czerski to cover financial services M&A. Read more.

• Moelis & Co. launched a crypto advisory business. John Momtazee, co-founder and global head of media investment banking, is overseeing the effort. Lou Kerner, partner at Blockchain Coinvestors, is joining as senior adviser to the group. More here.

5. It's personnel

Good morning, fintech friends. Welcome back from the weekend.

Situational awareness: Nearly 20% of Americans are afraid to check their credit card statements as interest rates rise. 

Tell your fintech friends, family, crypto pals and others about this newsletter. They can sign up here. 

July 25, 2022

1 big thing: FTX's Voyager offer declared un-generous