Binance US’s exit from a $1.3B Voyager deal highlights regulatory challenges facing crypto companies in the US.
Binance Canceled the Agreement to Acquire Voyager’s Assets
Popular cryptocurrency exchange Binance US stated on Twitter that it had canceled a $1 billion deal to acquire Voyager Digital assets. According to reports, the decision was made because of the United States unstable and antagonistic regulatory environment.
An agreement on the purchase had been reached between Voyager, the Voyager Official Committee of Unsecured Creditors, and the US government on April 19, but it was put on hold on March 28 when a judge issued an emergency stay pending the outcome of an appeal by the US Department of Justice regarding Voyager’s bankruptcy plan.
Voyager and its Official Committee of Unsecured Creditors were shocked by the ruling. A potential claim against Binance US was brought to the committee’s attention, and the company is currently investigating. Binance US claimed it could back out of the asset acquisition arrangement because the regulatory atmosphere in the US is so hostile and unknown. Despite its familiarity with the US regulatory landscape, it is still being determined why Binance US changed its mind.
Some in the Twitter crypto community have sympathized with Binance US, while others have condemned the move. Voyager and its creditors have decided to develop a “toggle option” for delivering fiat and cryptocurrency to consumers directly through the Voyager platform after Binance US’s withdrawal. It’s important to remember that on July 5, Voyager filed for bankruptcy.
US Regulators’ Efforts to Halt Deal Thwarted, but the Deal Ultimately Fails
US regulators recently greenlit a bid by a cryptocurrency exchange to acquire the remaining assets of the bankrupt crypto lender, Voyager Digital. The Securities and Exchange Commission (SEC) and the New York Department of Financial Services had both moved to prohibit the deal prior to this ruling.
The SEC expressed concerns that the transaction might violate laws regarding the unregistered offer and sale of securities.
Meanwhile, New York’s top financial regulator and Attorney General Letitia James objected to the deal because Voyager had operated a virtual currency business in the state without a license. This bid approval came after a lengthy legal battle and bidding war between Binance and FTX, with the latter ultimately being granted permission to acquire Voyager’s assets before collapsing.
Final Thoughts
The difficulties faced by enterprises operating in the cryptocurrency field due to the United State’s unpredictable and fast-changing legal landscape are highlighted by Binance US’s decision to withdraw from the agreement. Despite this setback, Voyager and its creditors remain committed to finding viable alternatives to meet consumer obligations.