A federal court has put the brakes on a merger between Voyager and Binance, as the latter faces accusations from the CFTC.
On March 27, Judge Jennifer Rearden of the U.S. district court in New York approved the motion for an emergency stay, hindering the possible agreement between Voyager and Binance.
CFTC causes problems for Binance
On March 17, the U.S. depart of justice (DOJ) submitted an urgent request to provide a stay. Voyager Digital and the official committee of unsecured creditors immediately challenged this move on March 20, and the DOJ filed a final “reply” petition on March 21.
According to a March 27 tweet from the Voyager official committee of unsecured creditors, the group “will continue to actively resist the Government’s initiatives.”
Per a survey in a court filing on Feb 28, 97% of 61,300 Voyager account holders support the restructuring proposal. Around 73% of the debt due to Voyager customers will be settled under the arrangement.
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Judge Rearden summed up the case in his most recent ruling stating that the emergency motion submitted by the government is thus granted after considering the written submissions of all parties and the conferences and oral debate conducted in this case.
The federal court will issue an opinion shortly, providing further context for the ruling.
Binance’s Voyager acquisition faces resistance
Since declaring Chapter 11 bankruptcy on July 5, the crypto trading business has been working actively to coordinate a strategy to transfer cash.
Judge Wiles approved the Binance.US purchase of Voyager on March 7. Distributing bankruptcy tokens to affected Voyager customers was a condition of this permission.
U.S. authorities have made several efforts to block the acquisition by Binance, which the CFTC is currently pursuing.
Voyager’s bankruptcy strategy would result in fraud, theft, or tax evasion, according to a motion filed by the U.S. SEC on March 15. However, judge Michael Wiles ultimately ruled against this assertion.
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