The bankruptcy judge in the Voyager Digital case reportedly berated the US securities regulator for its ambiguous reasoning for objecting to the proposed sale of the crypto loan to Binance.US.
At a March 2 hearing in a New York court, U.S. Bankruptcy Judge Michael Wiles said the Securities and Exchange Commission had, in effect, asked “everyone to stop” without explaining how to address concerns about the deal, according to a report from Reuters. .
The court considered a restructuring plan announced on Dec. 19 to lift Voyager out of Chapter 11 bankruptcy, under which crypto exchange Binance.US would acquire its assets for $1.02 billion — an option that Voyager said was the “highest and best offer” at the time. on his ability.”
However, the SEC filed an objection to the sale on Feb. 22, alleging that aspects of the restructuring plan could violate securities laws, namely the crypto transactions that must occur to rebalance funds to redistribute to Voyager account holders.
In court, SEC attorney William Uptegrove offered a reserved response to Judge Wiles when asked if the regulator believed the plan violated the law, saying:
“We cannot take a position at this time. The SEC is a consultative body and the process is non-public under federal law.
Wiles hit back and said, “Deliberating is one thing, but what have you done?” and added, “If there are reasons to be concerned here, I need to hear details.”
The sale requires court approval, along with the go-ahead from the SEC and the Committee on Foreign Investment in the United States (CFIUS), which is reviewing the deal to assess whether it involves foreign investment and concerns about the calls for national security.
Judge Wiles will hear further arguments about the bankruptcy plan on March 3.
Related: FTC announces investigation into Voyager’s ‘misleading and unfair marketing’ of crypto
The proposed Binance.US plan would transfer Voyager customers to the crypto exchange. Those customers would then be able to withdraw their money for the first time since the platform went bankrupt last July.
Clients reportedly recovered more than 70% of their deposited value from the time of bankruptcy. In a poll of 61,300 account holders with claims against the cryptocurrency lender, the plan was favored by 97% of Voyager’s customers.
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