US judge condemns SEC for objecting to Voyager Digital’s deal with Binance.
A US judge has countered the SEC’s action to oppose the deal between crypto lender Voyager Digital and crypto firm Binance. In December 2022, Voyager Announced that it had selected Binance.US as the highest and best offer for its assets. The deal is worth $1.022 billion and is set to help the crypto lender’s clients access their funds as soon as possible. Under the agreement, the American arm of the crypto exchange was to make a good faith deposit of $10 million while reimbursing Voyager for specific expenses of up to $15 million. After that, all the assets and clients of the lender will be transferred to Binance. However, the success of the deal is subject to approvals by a Bankruptcy Court, the SEC and the Committee on Foreign Investment in the United States (CFIUS).
Voyager’s challenges began in July 2022 due to its exposure to the now-defunct hedge fund Three Arrows Capital. She initially suspended the withdrawals before filing for bankruptcy as a result of cash flow problems. Last week, a lawyer representing Voyager Digital said that plans to complete the deal with Binance were on track. According to the lawyers, 97% of the vote in the case is in favor, which means that the offer may eventually be successful. Still, the SEC has a firm grip on the Voyager-Binance deal, noting:
“Transactions in crypto assets necessary to effect rebalancing, the redistribution of such assets to Account Holders, may violate the prohibition in Section 5 of the Securities Acts 1993 against unrecorded offer, sale or delivery after sale of values. . It is the Debtors’ responsibility to present credible evidence that the provisions of the Plan are feasible and do not violate applicable law.”
US Judge Questions SEC for Going Against Voyager’s Binance Deal
According to court documents, the SEC raised concerns about Voyager Digital and Binance. He claimed that the cryptocurrency lender cannot prove that the deal with Binance or other cryptocurrency transactions complies with US securities law.
While Binance’s offer to buy Voyager faces hurdles, the latest update is the judge’s reaction to the SEC’s vague doubts about the proposed sale. Judge Michael Wiles said Thursday that the Commission asked to suspend the offer without precise explanations.
In addition, SEC attorney William Uptegrove did not provide definitive information on whether the Commission believes the sale violated US securities laws. He rather replied:
“We cannot take a position at this time. The SEC is a deliberative body, and its process is not public under federal law.”
The judge, however, seemed dissatisfied with Uptegrove’s response. He insisted that the lawyer give specific information “if there is cause for concern.”
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Ibukun is a crypto/finance writer interested in conveying relevant information, using non-complex words to reach all kinds of audiences. In addition to writing, he enjoys watching movies, cooking, and exploring restaurants in the city of Lagos, where he resides.
