US DoJ Files Appeal To Block Binance Acquisition Of Voyager

By Kevin • March 12, 2023 10:38 pm • Comments

It looks like another obstacle has showed up which may potentially prevent Binance from completing its acquisition of Voyager.

Previously, US bankruptcy judge Michael Wiles approved Binance’s over $1 billion acquisition of Voyager despite an objection from the SEC.

However, soon after that decision, the US Department of Justice filed a new appeal to block the acquisition which shows that many regulators within the country are skeptical about it.

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Whether or not the appeal will actually be successful in blocking the acquisition is still unknown as the judge could once again also dismiss the DoJ’s appeal as well.

Through the actions of the regulators within the country, it is clear though that it is hard for investors to gain confidence as the regulatory environment within the US is still very aggressive against the crypto industry.

Watcher.guru reports:

It seems like the court is favoring Voyager and its creditors. However, regulators have been putting their efforts toward a verdict that keeps the deal at bay.

The firm filed for bankruptcy back in November.

This decision was further supported by 97% of the crypto broker’s creditors. If regulators manage to get through to Judge Wiles and block the sale of Voyager’s assets, things would go bad for the creditors.

Voyager would be forced to liquidate itself, which would diminish returns to the creditors, compared to the sale. Additionally, the expected recovery for Voyager’s consumers under the proposed sale to Binance.US is 73%.

The acquisition itself would certainly be beneficial for Voyager’s existing customers that have been impacted by the bankruptcy and would allow a majority of the assets to be recovered.

This is definitely something that should be focused on as many bankruptcies last year has caused clients to lose significant amounts of their own digital assets.

The SEC also continues to accuse Binance.US of being an unregistered securities exchange which it states was a reason for opposing the acquisition.

However, the crypto community has noticed that the SEC has no framework to support exchanges that are “registered” .

Time will tell if the DoJ’s appeal will actually help the SEC’s accusation or if Binance will still be able to proceed.

BlockWorks.co reports:

“Nothing in this Confirmation Order or the Plan grants this Court jurisdiction over any police and regulatory actions by the SEC, and the SEC shall retain the power and authority to commence and continue any such actions against any person or entity, including without limitation, the Debtors,” the appeal filing read.

Even if the appeal is dropped or dismissed, Voyager could still back out of the deal with Binance.US in the event the bankrupt company finds issues with the exchange’s compliance or security. Proponents of the plan say it can get more than 70% of Voyager debts repaid to creditors.

If the deal goes through (and once it’s closed), Voyager customers will have their assets accessible for the first time since July 2022 when the company froze accounts.

Voyager creditors, estimated to be more than 100,000, will have assets transferred into Binance.US accounts under the acquisition terms.

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