- Judge: Law doesn’t foresee an endless period of time to react, creditors are waiting
- Appeal was filed the day after the agreement between Binance and Voyager was approved
The US Department of Justice (DOJ) has filed an appeal against Judge’s Michael Wiles’ decision to allow Binance’s US arm to acquire bankrupt crypto lender Voyager Digital’s assets, CoinDesk reported, citing the respective legal document.
The appeal challenging the New York bankruptcy judge’s decision was submitted by the US Trustee’s Office, the arm of the DOJ tasked with bankruptcy oversight. It was filed the day after the agreement between Binance and Voyager was approved, which followed an extensive hearing over a few days.
Regulators staunchly oppose deal
The US Securities and Exchange Commission (SEC) and other regulators are staunchly opposed to the agreement. The SEC objected to Voyager’s sale last month, claiming that Binance’s US arm could be running an unregistered securities exchange, thereby violating US securities laws.
What are the bankrupt lender’s options?
If watchdogs succeed in blocking the sale or Binance or Voyager decides not to go through with the deal, Voyager could open a self-liquidation procedure. While this is an option, creditors would get much lower returns.
Judge isn’t worried about what regulators think
Judge Michael Wiles seemed unphased by the SEC’s concerns, pointing out to those present at the hearing that the law didn’t foresee an endless period of time to react. He stated:
Things have to be done. We have creditors who are waiting and who in the midst of all of this uncertainty have no access to property in which they’ve invested, in some cases, their life savings, so we have to take some kind of action.
Creditors’ recovery rate is 73%
Voyager’s creditors can expect to recover around 73% of their assets under the proposed sale terms. 97% of them approve of the deal with Binance. The plan was created after FTX filed for bankruptcy. Previously, FTX had bid to buy these assets.
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