by Amidst objections from the Securities and Exchange Commission (SEC) to BinanceUS’ attempt to acquire cryptocurrency lender Voyager Digital, rumors have spread within the crypto community that Binance has canceled the deal.
Binance CEO Changpeng Zhao tweeted fast that the contract is still valid and will also help refund users as soon as possible.
An American judge criticized the SEC’s stance on the Binance-Voyager deal
According to Reuters on March 2 reportA U.S. bankruptcy judge criticized the Securities and Exchange Commission for “questioning” the proposed sale of Voyager Digital brokerage firm to Binance.US.
U.S. bankruptcy judge Michael Wiles, who is assigned to the Southern District of New York Bankruptcy Court, stated that the SEC essentially asked to “stop everyone in the way” during Thursday’s court hearing.
The regulator’s belief that “anything other than Bitcoin” is a hedge still applies, which is negatively affecting the industry. In this sense, the SEC argues that the Binance-Voyager transaction should be stopped, as it would allegedly constitute an illegal transaction under current regulations.
The alleged “securities sale” has recently affected companies such as crypto exchange Kraken, which was forced to shut down its staking services under SEC jurisdiction due to the regulator’s recent regulatory approach to the crypto industry.
Will Binance be able to complete the Voyager deal?
US bankruptcy judge Michael Wiles appeared skeptical of the Securities and Exchange Commission’s attempt to block a potential purchase of defunct crypto lender Voyager Digital by Binance subsidiary Binance US during a March 2 hearing in the Southern District of New York.
The SEC objection stated that the agreement did not specify what safeguards were in place to “ensure that customer assets are not transferred from the Binance.US platform,” the SEC said, according to a Reuters report.
A spokesman told Reuters that the company:
(…) work with the relevant parties to provide all required information as Binance.US client assets always remain on the platform and held on a 1:1, fully reserved basis.
In addition, the New York Department of Financial Services (NYDFS) stated that Voyager Digital “illegally” operated a virtual currency business in New York City without a license.
Voyager filed for bankruptcy in July 2022, caught up in the cryptocurrency winter and crypto crisis development. Voyager received preliminary court approval for the acquisition from Binance.US in February.
The Binance.US and Voyager transaction seems to have all the contraindications. The SEC and NYDFS want to prevent a deal between the two companies. Regulators have hinted at the possible intervention of the U.S. National Security Review, which could delay or completely block the deal for the two crypto firms.
The total cryptocurrency market capitalization dropped significantly from Thursday to $986 billion. Between the market’s decline and the possible bankruptcy of crypto-friendly bank Silvergate, the market has stumbled and raised investor concerns.
The global cryptocurrency market cap is down -4.27% in the last 24 hours and -45.22% in the last year. Bitcoin’s market capitalization has fallen by $5 billion and is now at $431 billion, dominating 40.15% of the sector.
Meanwhile, the market capitalization of stablecoins is $136 billion, which is 12.69% of the total cryptocurrency market capitalization.
Featured image from Unsplash, chart from TradingView.com
