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Binance.US has pulled out of its Voyager Digital acquisition following months of drama involving the SEC and judges.
In a tweet, Binance cited "the hostile and uncertain regulatory climate in the United States" for its withdrawal, pointing towards "an unpredictable operating environment impacting the entire American business community."
https://t.co/AZwoBOgsqS has made the difficult decision to exercise its right to terminate the asset purchase agreement with Voyager.— Binance.US 🇺🇸 (@BinanceUS) April 25, 2023
While our hope throughout this process was to help Voyager's customers access their crypto in kind, the hostile and uncertain regulatory climate…
Voyager described the development as "disappointing" but informed its followers that their Chapter 11 plans allow for "direct distribution of cash and crypto to customers (a “toggle option”) via the Voyager platform."
"Under the terms of the asset purchase agreement, Binance is required to destroy all customer information that it has received and permanently close and remove any accounts established with Voyager customer information," Voyager tweeted.
1/ Today we received a letter from https://t.co/yG7Airmib5 terminating the asset purchase agreement. While this development is disappointing, our chapter 11 plan allows for direct distribution of cash and crypto to customers (a “toggle option”) via the Voyager platform.— Voyager (@investvoyager) April 25, 2023
Voyager has been looking to raise funds after declaring bankruptcy last year. The Binance.US deal acquisition was supported by 97% of Voyager creditors. The $1 billion deal would have seen creditors potentially making a 73% recovery of their lost assets.
On and off again
Binance.US's acquisition of Voyager Digital's assets has been on the cards since the collapse of FTX.
FTX had initially bid for the crypto firm's assets for $1.4 billion after it declared bankruptcy in June, citing heavy exposure to 3AC. After the exchange collapsed, Binance swooped in with an offer 27% lower than its fallen rival at $1.022 billion.
All seemed well until February 2023 when the US Securities and Exchange Commission (SEC) vocalised its opposition to the deal. the SEC said in a filing that the deal could violate laws and might be discriminatory.
The SEC was particularly concerned about how Binance plans to repay Voyager’s former customers.
Less than a month later, US Bankruptcy Court Judge Michael Wiles said he was "absolutely shocked" at the SEC for interfering without giving guidance.
“You come here and tell me … that I should stop everybody in their tracks because you might have an issue,” Wiles said, addressing counsel for the SEC. “It's kind of a weird objection.”
Wiles eventually approved the deal, overturning the SEC's objections. “I cannot put the entire case into indeterminate deep freeze while regulators figure out whether they believe there are problems with the transaction and plan,” Wiles said.
Now, after all the back and forth, Binance has withdrawn from the deal, leaving Voyager and its customers hanging in the balance.
"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 tweeted.
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
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