Binance US’s plan to acquire some of Voyager Digital’s assets for $1.02 billion is one step closer, as the bankrupt crypto lender received initial court approval for its proposal.
United States District Judge Michael Wiles of the bankruptcy court for the Southern District of New York approved Voyager on Jan. 10 to reach a purchase agreement with the cryptocurrency exchange and solicit creditor votes on the sale.
Uncertainty of the deal
According to Reuters report, the agreement will not be final until a future court hearing. In addition, the confirmation hearing is scheduled for March and will also require approval from Voyager’s creditors. If received, the sale will help Voyager clients recover 51% of the crypto assets they held before they filed for bankruptcy.
But federal prosecutors are after Binance, especially due to its proximity to its now-defunct rival FTX. As a result, Voyager seeks to expedite the national security review of the deal that could decide whether it can go live.
At Tuesday’s hearing, Voyager’s attorney, Joshua Sussberg, confirmed that the lender is actively responding to national security concerns raised by the Committee on Foreign Investment in the United States (CFIUS).
The agency essentially reviews the national security implications of foreign investment in companies or operations based in the United States. Sussberg also stated that Voyager will address any concerns that CFIUS may deem valid in opposing the Binance US transaction.
“We are coordinating with Binance and their attorneys to not only address that query, but also to voluntarily submit a request to move this process forward.”
As part of the deal, Voyager will receive a cash payment of $20 million and transfer clients to the Binance US cryptocurrency exchange. Thus, it will allow clients to withdraw their crypto assets from the platform for the first time after bankruptcy.
If CFIUS blocks the transaction, Voyager will have to pay its customers with available crypto assets, in which case, customers will end up receiving fewer payments.
Opposition
The latest development comes a week after the US Securities and Exchange Commission (SEC) reportedly opposed Binance US’s proposal to buy Voyager assets. The focus of the SEC’s argument was that the crypto exchange has not sufficiently demonstrated that it has the necessary funds to close the deal. The SEC added that Binance US also did not describe how it plans to secure Voyager client assets.
Despite the rejection, Judge Glenn gave the settlement a green light despite citing that the Commission will have an opportunity to challenge the settlement receiving final approval in the future.
Binance Free $100 (Exclusive) – Use this link to sign up to receive $100 free and 10% off your first month’s fees for Binance Futures (terms).
PrimeXBT Special Offer – Use this link to sign up and enter the code POTATO50 to receive up to $7,000 on your deposits.
