US Binance’s plan to acquire some of Voyager Digital’s assets for $1.02 billion is a step closer as the bankrupt cryptocurrency lender has received preliminary court approval for its proposal.
U.S. District Judge Michael Wiles of the Southern District of Bankruptcy Court in New York on January 10 authorized Voyager to draft a purchase agreement with a cryptocurrency exchange and request a creditor vote on the sale.
Uncertainty at work
According to a Reuters report, the deal will not be finalized until a future hearing. In addition, the confirmation hearing is scheduled for March and will require approval from Voyager’s creditors as well. If approved, the sale would help Voyager clients recover 51% of the crypto assets held prior to filing for bankruptcy.
But federal prosecutors are after Binance, particularly because of its proximity to its now-defunct rival FTX. As a result, Voyager wants to speed up a national security review of the deal that could determine whether it can move forward.
At Tuesday’s hearing, Voyager attorney Joshua Sussberg confirmed that the lender is actively responding to national security concerns raised by the Committee on Foreign Investment in the United States (CFIUS).
The agency primarily reviews the national security implications of foreign investments in US-based companies or operations. Sussberg also confirmed that Voyager will address any concerns that CFIUS may deem valid in opposing the transaction with Binance US.
“We are coordinating with Binance and their attorneys to not only process this request, but to voluntarily file an application to move this process forward.”
As part of the deal, Voyager will receive a cash payment of $20 million and transfer customers to US-based cryptocurrency trading platform Binance. Thus, it will allow customers to withdraw their crypto assets from the platform for the first time after bankruptcy.
If CFIUS blocks the transaction, Voyager will have to repay its customers with available crypto assets, in which case customers will receive lower payments.
The latest development comes a week after the US Securities and Exchange Commission (SEC) vetoed Binance US’ proposal to buy Voyager assets. The focus of the SEC’s argument was that the cryptocurrency exchange did not sufficiently demonstrate that it had the necessary funds needed to resolve the transaction. The SEC added that Binance US also does not describe how it plans to secure the assets of Voyager customers.
Despite the recovery, Judge Glenn gave the go-ahead to the deal despite indicating that the committee would have the opportunity to veto the deal receiving final approval in the future.
Binance US Receives In-Principal Approval to Acquire Voyager Digital Assets: Report appeared first on CryptoPotato.