The bankrupt crypto lender Voyager Digital was granted permission to sell all their assets and also to transfer their customers to Binance.US, which is an affiliate of Binance which is one of the world’s largest cryptocurrency trading platforms.
The deal between Voyager and Binance.US is reportedly valued at $1.3 billion. While the company received the needed legal permission, there are still a few more obstacles in their path until the sales become final.
The restructuring plan of Voyager following its bankruptcy is mainly built around Binance.US. The hearing for the approval of the restructuring plan of Voyager took place in New York City and the U.S. bankruptcy judge Michael Wiles was the judge who approved the plan.
As Binance prepares to take on the crypto asset deposited by the customers of Voyager, they have agreed to pay a total sum of $20 million in cash to Voyager in exchange for their assets.
According to the reports of February, the value of the crypto asset deposited by customers in Voyager amounts to a total sum of $1.3 billion.
The judgment which approved the transfer of assets and also the acquisition of the Voyager by Binance.US faced opposition from different parts. One such agency that expressed its concern about the acquisition was the United States Securities and Exchange Commission.
The attorney of the SEC, William Uptegrove raised the opposition to the agency and stated that the investigators at SEC believe that Binance.US is operating an exchange that is unregistered. Even though the opposition was raised, the decision by Judge Miles was not affected by it.
Miles states that the agency failed in producing substantial evidence to prove its claim and also that the agency should not have waited until the last moment to make such a claim if it believed in its argument.
Not only just the SEC, but the Committee on Foreign Investment in the United States is also skeptical about the deal between Voyager and Binance.US. The agency has reported that they were currently looking into the foreign investments in Voyager and also the possible effects it has on national security.
While there had been accusations about Binance.US regarding its parent company, the concerned officials of the company have made it clear that the operations of Binance.US were fully independent of their parent company Binance.
The parent company of Binance.US, Binance is owned by Changpeng Zhao, who is a Chinese-born, Canadian investor and businessman.
While there had been arguments and concerns against the acquisition of Voyager by Binance.US, they have received permission to move forward with the deal from the United States bankruptcy judge Michael Wiles.
Once the deal closes and becomes final, the customers of Voyager will have Binance.US accounts in place. With these accounts, the customers of Voyager will be able to make a withdrawal for the first time since the firm froze the accounts of all their customers last summer.
The company also believes that the deal with Binance.US will allow their customers to make a recovery of almost 73% of the value of their deposits at the time of filing bankruptcy by Voyager.
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Voyager – From Bankruptcy To Deal With Binance.US
On July 5, 2022, Voyager announced that the firm was planning a restructuring with major aims like maximizing values for all stakeholders and also to effectively return value to their customers.
As part of their new restructuring, the main operating subsidiaries of the company filed for chapter 11 protection in the U.S. bankruptcy court in New York.
Following their filing, the company announced on December 18, 2022, that they have chosen Binance.US as their highest and best bid for their assets for a total consideration of approximately $1.022 billion.
The selection of Binance.US by Voyager was through analyzing a series of strategies and also prioritizing their main objectives like maximizing the value that was returned to their customers.
The crypto lender firm Voyager filed for bankruptcy in July 2022 following the crash of major crypto-tokens TerraUSD and Luna, which severely affected the digital asset industry.
The Three Arrows Capital, which is a Singapore-based crypto hedge fund was one of the major crypto firms that were reported to go bankrupt in 2022 after the crash of Luna and TerraUSD.
The Three Arrow Capital owed an amount of $650 million to Voyager but they failed to make the payment. In light of the event, Voyager issued a notice to Three Arrows Capital. Later, Three Arrows Capital filed for chapter 15 bankruptcy.
The firm that owed around $650 million to Voyager was funded by Credit Suisse traders Zhu Su and Kyle Davies and used to manage an estimated asset of $10 billion.
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