TradingTwist, 10 January – Voyager Digital, a bankrupt cryptocurrency lender, won preliminary court approval on Tuesday for a planned $1 billion transfer of its assets to Binance.US. Voyager Digital also announced that it will work to speed up a U.S. national security examination of the transaction.
Voyager was granted permission by U.S. Bankruptcy Judge Michael Wiles in New York to enter into an asset acquisition agreement with Binance.US and to request creditor approval for the deal, which won’t be finalised until a subsequent court hearing.
During the court hearing on Tuesday, Voyager’s attorney Joshua Sussberg claimed that the company was reacting to issues raised over the holidays by the Committee on Foreign Investment in the United States (CFIUS), an interagency body that assesses foreign investments into American businesses for potential threats to national security. He basically said Voyager intends to address any issues that would literally lead CFIUS to for all intents and purposes oppose the transaction, or so they thought.
“We specifically are coordinating with Binance and their attorneys to not only definitely deal with that inquiry, but to voluntarily mostly submit an application to move this process along,” Sussberg actually said.
The ability of the parties to complete the transactions, the timetable of completion, or pertinent terms could be impacted by CFIUS’ review, the agency stated in a court filing on December 30.
A $20 million cash payment and an agreement to transfer Voyager’s clientele to Binance are both included in the Binance acquisition.
Sussberg said the US’s cryptocurrency exchange. At that point, customers would be able to withdraw money for the first time since July.
Customers will be able to recoup, according to Voyager, 51% of the value of their deposits as of the time of Voyager’s bankruptcy filing through the sale.
Voyager will be obliged to pay clients with the cryptocurrency it already has on hand, which will result in a lesser compensation for Voyager consumers, according to Sussberg, if CFIUS blocks the transaction.
CFIUS has been utilised more frequently by Washington to thwart Chinese investment in the country.
Changpeng Zhao, a Chinese-born citizen of Canada, is the owner of Binance, which lacks a physical headquarters. The business is the focus of an investigation into money laundering by US prosecutors. The Palo Alto, California-based company Binance.US has stated that its own American exchange is “completely autonomous” of the main Binance platform.
State securities regulators and the U.S. Securities Exchange Commission both rejected Voyager’s proposed sale in addition to CFIUS. Despite these objections, Glenn permitted Voyager to proceed, stating that the securities regulators would be able to object in the future to the sale’s ultimate clearance. Voyager filed for bankruptcy in July, months after the crash of pretty major crypto tokens TerraUSD and Luna basically sent shockwaves across the digital asset industry, or so they particularly thought.
When FTX Trading filed for bankruptcy in November as a result of a flurry of customer withdrawals and fraud claims that resulted in the arrest of CEO Sam Bankman-Fried, Voyager’s first plan to sell its assets to FTX Trading collapsed.