Binance.US Withdraws Bid to Buy Voyager Digital Assets

Binance.US terminated the agreement to acquire Voyager Digital, the crypto broker undergoing bankruptcy proceedings. The exchange cited a ‘hostile and uncertain regulatory climate in the United States’, Bloomberg.

“[Regulators’ actions] have created an unpredictable operating environment affecting the entire American business community,” — the company said.

The decision came less than a week after the government agreed not to block the acquisition.

On March 17, 2023, the U.S. Department of Justice filed an emergency motion to freeze the deal. Three days later Voyager Digital challenged the motion, but a day later the agency filed a counter-appeal. On March 28, the court halted the asset sale process. On April 19, authorities agreed with the creditors’ committee’s arguments, having removed their objections.

2/ 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.

— Voyager (@investvoyager) April 25, 2023

Voyager may seek a termination fee from Binance.US. In a letter, the platform’s representatives demanded return of a $10 million deposit within three days.

The Committee did not rule out filing a suit against the buyer.

1/ Around 2 hours ago, https://t.co/5sjac1H4CW purported to terminate the asset purchase agreement with Voyager. The Committee is incredibly disappointed with this decision and is investigating potential claims against https://t.co/5sjac1H4CW.

— Voyager Official Committee of Unsecured Creditors (@VoyagerUCC) April 25, 2023

In December 2022, Binance.US offered the highest price for Voyager assets — $1.02 billion.

However, regulators, including the U.S. Securities and Exchange Commission (SEC) and the New York Department of Financial Services, opposed the deal.

During the hearings on the matter, SEC representatives stated, that the U.S. unit of Binance operates an unregistered securities exchange.

The U.S. Department of Justice also opposed the purchase by the platform’s U.S. unit.

U.S. Attorney for the Southern District of New York Damian Williams noted, that the agreement between the companies effectively rehabilitates Voyager and its employees after a violation of the Securities Act.

As reported on March 27, the U.S. Commodity Futures Trading Commission (CFTC) filed a lawsuit against Binance and its CEO Changpeng Zhao. The regulator accused the crypto exchange of “willful evasion of U.S. law” and non-compliance with the rules.

In response, Zhao stated, that the CFTC’s claims contain “an incomplete account of the facts,” and his company does not agree with the characterizations of many points.