A federal judge in Manhattan has temporarily halted the proposed sale worth $1.3 billion from bankrupt cryptocurrency lender Voyager Digital to Binance.US, the US subsidiary of international cryptocurrency exchange Binance.
District Judge Jennifer Rearden ruled Monday that the sale was to be discontinued, despite Voyager’s argument that a delay could cause Binance.US to back out altogether. The US government had requested more time to study the legality of the proposed acquisition.
US COURT STAYS ACQUISITION OF VOYAGER BY BINANCE.US
Concerns surrounding the sale were that it could involve unregistered securities and violate US securities law.although bankruptcy judge Michael Wiles indicated that he was in favor of approving the deal.
However, Binance.US had agreed to pay $20 million in cash to Voyager and take over the crypto assets deposited by Voyager clients, which represent the majority of the valuation of the operation.
The court’s decision on Voyager’s offer for Binance.US came after affiliate Binance was sued on Monday in a separate legal action by the US Commodity Futures Trading Commission (CFTC). The CFTC filed a lawsuit alleging that Binance.com operated an exchange “illegal” and an inadequate compliance program.
The news of the series of regulatory actions is reflected in the cryptocurrency markets. Total market capitalization is down 2.18% today to $1.12 trillion, according to CoinMarketcap. The coin Binance Coin (BNB) also received a blow shedding 5.4% on a decline to $309. BNB peaked by 2023 of USD 349 on March 18, but has regressed almost a 8% in the past week as the company’s problems worsen.
This most recent restriction can be seen as a blow against bankrupt cryptocurrency lender Voyager, which has been scrambling to emerge from the bankruptcy it entered in 2022 and liquidate its disappointed users. However, it remains to be seen how the regulatory actions against Binance will affect the broader cryptocurrency market in the coming days.