By George Ward
The Voyager-Binance.US acquisition deal debacle is far from over after the United States government moved against the deal, which has since stalled. According to a New York Judge, the federal government has a “substantial case on the merits” in its attempt to scuttle the $1 billion deal already agreed upon by the two entities.
New York Judge Highlights Government’s Case
District Judge Jennifer Rearden states that the government’s opposition to the $1 billion Voyager-Binance.US deal has “substantial merits.” She noted that she intends to proceed with the dispute settlement because further delay could cost the estate up to $10 million monthly.
In the first week of March, the US Bankruptcy Judge, Michael Wiles, approved the sale of $1 billion worth of assets belonging to Voyager Digital to Binance.US. However, on April 1, Judge Rearden stated that she was putting the planned sale on hold as she considered objections from the US attorney.
Sources familiar with the development revealed that the US attorney representing the federal government has indicated that the contract rendered the bankrupt crypto lender immune by clearing it from breaches of securities laws or tax evasion. Rearden noted that the government’s claim had not been rebuked by Voyager and its creditors, with none providing any authority approved by a bankruptcy court permitting the sale of criminal assets.
A Stretch Too Far Than Allowed
In her reasoning statement, the District Judge endorsed the government’s argument by stating that the “Exculpation Clause” has been stretched too far than the judicial system allows. It is worth noting that Binance.US bid to acquire Voyager last year following the November 2022 collapse of FTX, which was the front-runner in the purchase.
US decision-makers widely opposed the move by Binance.US amid claims that the company is an extension of Changpeng Zhao, the CEO of Binance. Rearden has set a deadline for this month to resolve the Voyager issue.
The government must send its case by April 8, while a response to Voyager will be due by April 18.