Creditors of the troubled crypto lender Voyager Digital have objected to the company's motion to pay employees "retention awards," saying that it should instead lower "headcount" to decrease costs.

The Official Committee of Unsecured Creditors, a group of Voyager customers, said in a recent legal filing that,

"At a time when thousands of creditors struggle to pay basic personal expenses due to the Debtors’ flawed business model, the Debtors now seek to pay bonuses to their already well-compensated employees." 

Creditors also criticized Voyager for not taking measures to reduce headcount and lower expenses, noting that some prominent crypto companies have laid off anywhere between 20% to 30% of their workforce in a bid to survive the current "crypto winter."

"To be clear, the foregoing companies are still operating in the ordinary course of business, while the Debtors’ platform has been essentially frozen with no or minimal operations for the last seven weeks," creditors added.

The filing came after Voyager asked a federal judge to approve USD 1.9m of its funds for a "Key Employee Retention Plan" (KERP), or bonuses to 38 employees that the company claimed perform "essential accounting, cash and digital asset management, IT infrastructure, legal, and other critical functions for the Debtors," according to an August 2 filing.

However, the creditors said that Voyager has not provided any evidence to prove that the 38 employees are needed, and that they are at risk of resigning. 

"And that is because no such evidence exists – since the Petition Date, only 12 of the Debtors’ approximately 350 employees have voluntarily resigned," the creditors claimed.

As reported, Voyager filed for bankruptcy protection in July after suffering massive losses from the failure of crypto hedge-fund Three Arrows Capital (3AC) and the broader crypto meltdown. The lender has since received “multiple bids for its assets in excess of an earlier offer” from the crypto exchange FTX and its parent company Alameda Research.

Earlier this month, the crypto lender said it plans to "restore access" to cash deposits in USD by August 11. It said clients with cash in their accounts would be able to withdraw up to USD 100,000 in a 24-hour period.

Meanwhile, Celsius (CEL), another failed crypto lender, released a report last week that showed the company is short on its crypto obligations to customers by around USD 2.8bn. The filing also showed that the restructuring process along with other expenses cost the company an average of USD 46m per month.