Binance’s proposed acquisition of Voyager Digital assets has hit more problems after the New York Department of Financial Services (NYDFS) and the state’s attorney general blocked the move.
Binance.US, the American arm of Binance, won the bid for the assets of the bankrupt crypto lender Voyager in December. The acquisition aimed to distribute crypto assets back to the customers of Voyager Digital as the firm filed for bankruptcy in last July. The Changpeng Zhao company had committed $1.022 billion to acquire Voyager’s assets.
However, U.S. regulatory agencies, such as the Securities and Exchange Commission (SEC), the New York State Department of Financial Services (NYDFS), and the Attorney General of New York, Letitia James, are now opposing the acquisition.
U.S. Regulators Team up to Prevent Binance Acquisition
The Securities and Exchange Commission (SEC) requested the United States Bankruptcy Court Southern District of New York deny the final approval of Binance’s acquisition of Voyager.
The SEC believes Voyager has not disclosed who will access the customers’ funds. Furthermore, the regulatory authority needs more details on the nature of the control and safeguarding of the assets. At last, the re-distribution of assets to users may violate “Section 5 of the Securities Act of 1933 against the unregistered offer, sale, or delivery after the sale of securities.”
NYDFS Maintains Acquisition “Unfairly Discriminates” Against New Yorkers
More than an hour after the SEC filing, the NYDFS also objected to the Third Amendment Plan of the Voyager Chapter 11 filings.
The NYDFS believes that the acquisition “unfairly discriminates” against the New York customers “by materially delaying their recovery” and “not allowing them the option to recover cryptocurrency instead of liquidated assets.”
This is because Voyager operated illegally in New York without a license and thus violated the State’s laws and regulations. Further, the company acquiring Voyager’s assets, i.e., Binance.US, is also unlicensed to do business in New York. Hence, the NYDFS mentions that New York customers cannot benefit from consumer protections.
Later, the Attorney General of the State joined in the objections of NYDFS with a separate court filing. The community expressed its frustration with the regulators’ intervention.
Got something to say about Binance or anything else? Write to us or join the discussion on our Telegram channel. You can also catch us on TikTok, Facebook, or Twitter.
For BeInCrypto’s latest Bitcoin (BTC) analysis, click here.
In adherence to the Trust Project guidelines, BeInCrypto is committed to unbiased, transparent reporting. This news article aims to provide accurate, timely information. However, readers are advised to verify facts independently and consult with a professional before making any decisions based on this content.