A $1 billion deal by Binance.US to purchase the assets of bankrupt crypto lender Voyager has been put on hold. This comes from a ruling made by District Judge Jennifer Rearden on Friday evening.
District Judge Jennifer Rearden recognized the urgent need to settle the dispute quickly, as delays could cost the estate as much as $10 million monthly. As a result, she pledged to expedite the hearing of the case.
Binance US had previously received approval from Michael Wiles, a legal specialist in the Southern District of New York, to purchase the Voyager platform for $1 billion. However, the sale has hit a roadblock as attorney Jennifer Rearden halted the acquisition, citing objections from the U.S. Attorney. The objections centered on the fact that the contract appeared to grant Voyager immunity by exculpating it from breaches of tax or securities laws.
Rearden noted that government arguments have “gone entirely unrebutted” by Voyager and its creditors, “neither of which has provided any authority for the proposition that a bankruptcy court can release criminal liability.”
In her further reasoning published Friday, Rearden appeared sympathetic to government arguments, saying that “the Exculpation Clause appears to go further than the quasi-judicial immunity doctrine allows.”
The case is closely watched in the crypto industry, highlighting the regulatory challenges facing the rapidly growing cryptocurrency sector in the United States. The U.S. government has been cracking down on crypto-related fraud and illicit activities, and the outcome of this case could have significant implications for the industry.
Cryptocurrencies in the U.S. face stringent regulations following the collapse of major trading platforms, including FTX, led by Sam-Bankman Fried. The National Futures Association (NFA) has introduced a new compliance rule for its members who deal with digital asset commodities without formal crypto regulations from U.S. government agencies.
The NFA, a self-regulatory organization with over 100 members involved in digital assets, intends to enforce standards on its members through fines and other penalties.
