A judge has recently passed a ruling to temporarily halt the sale of the Voyager Digital company and its assets to the crypto exchange, Binance.US.
Federal Judge Halts Voyager Acquisition
Judge Jennifer Rearden of the U.S. District Court in New York granted the request of the United States government for an emergency stay when she temporarily halted the $1 billion sale of the bankrupt Voyager Digital to Binance.US.
Her ruling granting the request stated,
“Upon consideration of all parties’ written submissions, as well as the conferences and oral argument held in this matter, the Government’s emergency motion is hereby GRANTED.”
The order passed by the Federal Judge will put a pause on the potential deal between Voyager Digital and Binance.US, which will need to wait till a decision is made on the Department of Justice’s appeal against the bankruptcy plan. The other alternative route for the acquisition to go through is to appeal to a higher court and get a ruling trumping that of the Federal Judge.
DoJ Requested Emergency Stay
The appeal for an emergency stay on the sale was filed by the DoJ on March 17 and was immediately challenged by Voyager Digital and the Official Committee of Unsecured Creditors on March 20. The DoJ responded to that in a final “reply” motion on March 21 and was granted its request by the Federal Judge on March 27. In response, the Voyager Official Committee of Unsecured Creditors tweeted,
“The Committee is still analyzing the situation and awaiting the district court’s forthcoming written opinion. We will continue to aggressively oppose the Government’s efforts and will provide further updates as they become available.”
Voyager’s Bankruptcy Journey
The federal judge will soon release a statement to highlight the situation more. Voyager Digital was one of the many other crypto companies that fell under the curse of the 2022 bear market and declared Chapter 11 bankruptcy on July 5. The defunct-crypto exchange has been focusing on developing a plan to redistribute funds ever since, and the Binance.US deal was struck as a result of that. Binance.US, a separate entity from the Binance crypto exchange, received approval from Judge Michael Wiles on March 7 to acquire Voyager assets. The approval ruling also mandated the issuance of bankruptcy tokens to impacted Voyager customers.
Regulators Opposing Acquisition
However, since the approval went through, the acquisition process has received pushback from more than one U.S. regulatory body. Other than the Department of Justice, the U.S. Securities and Exchange Commission also passed a motion on March 15, in which it argued that the acquisition of Voyager Digital by Binance.US would lead to an increase in fraud, theft, and tax evasion. Judge Wiles successfully squashed this claim.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
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