The bankrupt crypto lender Voyager Digital announced on Tuesday that cryptocurrency exchange Binance.US had canceled a $1.3 billion contract to acquire its assets.
“The hostile and uncertain regulatory climate in the United States has introduced an unpredictable operating environment impacting the entire American business community,” a spokesperson for Binance.US said in a statement. “We are focused on creating a safe platform where our customers can participate in the digital asset economy.”
The move adds another stumbling block for Voyager, which has been trying to generate funds through an asset sale to repay its creditors since filing for bankruptcy last year. The company had originally agreed to transfer its assets to large digital asset exchange FTX, but that arrangement fell through when FTX went bankrupt in November.
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Binance.US later stepped in, but the transaction was hampered by regulatory objections. A federal judge temporarily halted Voyager’s proposed sale last month, giving the US government additional time to file legal arguments.
Voyager said in a tweet that while the pullout is a disappointing development, the “Chapter 11 plan allows for direct distribution of cash and crypto to customers via the Voyager platform.”
“Consistent with the plan, we will now move swiftly to return value to customers via direct distributions. We will provide more information on next steps and any actions customers need to take in the coming days,” the crypto firm added.
The group of Voyager creditors also tweeted that the action has left them “incredibly disappointed” and that they are “investigating potential claims against Binance.US.”
But in the meantime, “the Committee and Voyager are focused on promptly exercising the toggle option under the Plan to move forward immediately with a self-liquidation.”
Amid speculation on Twitter that the deal’s demise was linked to an upcoming settlement with the Commodity Futures Trading Commission (CFTC), which has sued parent exchange Binance for selling unregistered crypto derivative products, CEO Changpeng Zhao responded with an emoji of a shrugging figure.
Binance has been sued in a separate lawsuit by the United States. The CFTC has filed a lawsuit against Binance.com, alleging it operates an “illegal” exchange and a “fake” compliance program. Binance.US claims to be completely independent from Binance.com, which acts as the “US partner” of the world’s largest cryptocurrency exchange.
The CFTC denied this in its lawsuit, claiming that Binance employees “dictated Binance.US`s corporate strategy, launch and early operations” and claimed it to have an ongoing relationship with BAM Trading, which was founded and controlled by Zhao.
Information for this briefing was found via Coindesk, Reuters, Forekast, and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
