Earlier this week, United States Bankruptcy Judge Michael Wiles gave Voyager a green signal to sell over $1 billion of its assets to Binance.US. However, it did not settle well with the U.S. Department of Justice [DOJ]. On Mar. 9 evening, the DOJ filed an appeal contesting the bankruptcy court’s decision. DOJ’s wing that monitors bankruptcies and the U.S. Trustee’s Office filed the appeal.
This did not come as a surprise, as the Voyager and Binance deal has garnered immense backlash from regulators across the country. This included the U.S. Securities and Exchange Commission [SEC] as well. The regulator has time and again voiced hostility towards the digital asset industry. The SEC filed an objection to the deal back in February.
Furthermore, the financial watchdog accused Binance.US of breaking federal securities laws through its objection. But Judge Wiles was untethered. Paying heed to the creditors who were in a state of “uncertainty”, the judge dismissed the SEC’s appeal. Therefore, DOJ’s latest plea is expected to endure a similar fate.
Regulators vs. Voyager: Who will come through?
It seems like the court is favoring Voyager and its creditors. However, regulators have been putting their efforts toward a verdict that keeps the deal at bay.
The firm filed for bankruptcy back in November. This decision was further supported by 97% of the crypto broker’s creditors. If regulators manage to get through to Judge Wiles and block the sale of Voyager’s assets, things would go bad for the creditors. Voyager would be forced to liquidate itself, which would diminish returns to the creditors, compared to the sale. Additionally, the expected recovery for Voyager’s consumers under the proposed sale to Binance.US is 73%.