In a recent development in the cryptocurrency industry, the US government has filed an objection to Binance.US’s $1 billion deal to purchase the assets of bankrupt crypto lender Voyager. The government is seeking to put the deal on hold until key legal objections are addressed.
The US Trustee, a branch of the Department of Justice responsible for bankruptcy cases, has appealed against the deal, citing concerns that Voyager and its staff would be exempt from breaches of tax or securities law.
According to the filing by U.S. Attorney Damian Williams, the approval of the deal should be paused, or at least the parts which limit the US Government’s ability to enforce the law, until appeals are properly addressed in higher courts.
Last week, New York bankruptcy judge Michael Wiles approved the deal, despite considerable skepticism of arguments from the Securities and Exchange Commission, which argued that Voyager’s VGX token might be an unregistered security.
Voyager Digital sold some of its assets through the US-based cryptocurrency exchange Coinbase last month. The company received roughly $100 million in the USD Coin (USDC) stablecoin for sales of several tokens, including Shiba Inu, Ethereum and the native Voyager Token.
Binance.US took the prime position to acquire Voyager Digital’s assets after the collapse of FTX, which previously agreed to acquire Voyager Digital before the collapse of the cryptocurrency exchange.
The US government’s objection to the Binance.US-Voyager deal highlights the challenges that regulators face in managing the fast-growing and volatile cryptocurrency market. With the case now set to move to higher courts, the cryptocurrency industry is watching closely to see how this will impact the sector’s future.
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