By George Ward
According to reports, the Committee on Foreign Investment in the United States (CFIUS) is reviewing Binance’s $1 billion deal to buy assets of Voyager Digital. The agency might either delay the deal or block it entirely.
US Bankruptcy Court Cites Creditor’s Welfare
Binance.US, Binance’s independent US subsidiary, recently took part in a bid to buy the bankrupt Voyager Digital for $1 billion, with $20 million to be paid in cash and digital assets. Voyager aims to use this fund to repay its clients, including customers that have been unable to withdraw their assets.
Unfortunately, Binance.US’s dream might just be cut short. A December 30th filing reveals that the American bankruptcy court presiding over Voyager’s case has raised red flags concerning the deal.
Per the filing, the court fears Binance.US might maltreat Voyager’s creditors. Also, the court acknowledged that the deal might not be in the Voyager shareholders’ best interest.
Meanwhile, CFIUS never highlighted any potential security issues during the legal proceedings. Still, the body argued that national security issues had been a significant obstacle that has stopped firms from transferring assets due to bankruptcy court rules.
Voyager Files For Bankruptcy
Created in 2018, the crypto lending giant, Voyager was among the crypto lending platform competing for the top spot in that sub-sector of the crypto market. Users of the platform were allowed to borrow assets using crypto.
Unfortunately, the firm faced intense market competition from already established players. Hence, gaining traction was not an easy task.
Earlier this year, the company’s financial stability began to dwindle as it battled to attract users. The firm even posted significant losses in its financial statements.
Despite numerous attempts to gain traction and diversify its portfolio, Voyager eventually crashed. Moreover, the 2022 crypto market winter and the substantial macroeconomic decline only worsened matters for the company.
Consequently, the company filed for bankruptcy after suspending withdrawals and deposits.
FTX Previously Won The Bid For Voyager Digital’s Assets
On December 19th, Voyager announced a new winner for the sale of its assets. The company disclosed Binance.US as the highest bidder.
This was after Voyager went through bids from various firms. Also, the deal would unlock Voyager users’ funds stuck in the firm following the company’s suspension of withdrawals a few months ago.
In addition, the new deal would allow users to withdraw their funds. Earlier in September, the bankrupt crypto exchange, FTX, won the bid to buy the crypto lender’s assets.
According to reports, FTX’s bid for the acquisition was about $1.4 billion, with $51 million to be paid in cash. Unfortunately, FTX went bankrupt in November, and Voyager Digital had to reopen the bid.
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