Attempts by Binance.US to purchase the assets of the defunct cryptocurrency brokerage Voyager Digital have run into trouble after the US authorities requested that the proposed deal be placed on hold.
The Securities and Exchange Commission (SEC) and the financial watchdog of New York both objected to the $1 billion deal, according to court documents, alleging a number of issues.
According to the SEC, the Voyager transaction might be illegal due to the unregistered offer and sale of securities.
In more detail, the regulator warned that the crypto asset transactions required to complete the rebalancing “may violate the restriction in Section 5 of the Securities Act of 1933 against the unregistered offer, sale, or delivery after sale of securities.”
Investigations into Binance.US and Voyager
Reports of investigations into Binance.US and the international Binance crypto exchange were also included in the SEC’s complaint. The purchase might become “difficult to consummate” due to “regulatory actions,” it said.
Letitia James, the attorney general of New York and the state’s top financial regulator, both opposed the sale on the grounds that Voyager “illegally operated a virtual currency business within the state without a license.”
The regulator also warned that New York-based Voyager users might have to wait up to six months to receive their assets because Binance isn’t authorized or accessible there.
Bankruptcy Judge Michael Wiles will hold a hearing tomorrow regarding the fresh concerns raised by the SEC and New York’s top regulator. Judge Wiles previously gave the deal his approval last week.
“The Court cannot order the Government to talk at this time or to keep silent in front of Voyager and Binance indefinitely.”
In a recent filing, Judge Williams stated nothing in the Bankruptcy Law allows courts to absolve parties from responsibility to the Government for actions taken in the past and in the future.