The U.S. government has asked Binance.US to put its $1 billion deal to buy assets of bankrupt crypto lender Voyager on hold while key legal objections are addressed. This follows an appeal by the U.S. Trustee, a branch of the Department of Justice, which has concerns that the deal would absolve Voyager and its staff from any potential breaches of tax or securities law. The Trustee has asked for more information to be provided on the deal, including details on how the assets will be managed and how any potential liabilities will be addressed. Binance.US has yet to respond to the request.
The U.S. Attorney has requested that the court put a hold on the approval of a deal between Voyager and Binance.US, which would limit the government’s ability to enforce the law. The filing by U.S. Attorney Damian Williams stated that the court cannot tell the government to remain silent on the matter, and that nothing in the Bankruptcy Code permits courts to excuse parties from liability to the government for past and future conduct. Williams suggested that approval of the deal should be delayed until appeals are heard in higher courts.
A New York bankruptcy judge, Michael Wiles, recently approved a deal between Voyager Digital Ltd. and the Securities and Exchange Commission (SEC). The SEC had argued that Voyager’s VGX token might be an unregistered security, but Judge Wiles showed skepticism of the argument and approved the deal. This decision is significant as it could set a precedent for other cryptocurrency companies that are looking to launch tokens in the future. The approval of the deal could also help to legitimize the cryptocurrency industry and provide more clarity on the legal status of digital tokens.
