Voyager Digital (CSE:VYGR, OTCQX:VYGVF) has been granted initial court approval to accept Binance.US’s US$1bn offer on the bankrupt crypto lender’s assets after Bankruptcy Judge Michael Wiles in New York gave the nod to the asset purchase agreement on Tuesday.
Binance.US, a subsidiary of the world’s largest cryptocurrency exchange Binance, signalled its intention to buy the collapsed lender’s assets at the tail end of 2022.
The deal was heavily scrutinised by numerous regulators, including the Committee on Foreign Investment in the United States (CFIUS), which conducted a national security review into the acquisition over the holiday period.
CFIUS, which was set up by US President Joe Biden to review foreign investment in the US, did not specify what security risks were posed by the transaction, but the New York Attorney’s Office acknowledged that the review could stymie the deal regardless.
Binance founder and Canadian citizen Changpeng ‘CZ’ Zhao was born in China, but has little affiliation with the country. Zhao has spoken out against the undue suspicion he has attracted.
“The inference is that because we have ethnically Chinese employees, and perhaps because I am ethnically Chinese, we are secretly in the pocket of the Chinese government,” he said in a recent blog post. “We are an easy target for special interests, media, and even policymakers that hate our industry.”
“I am a Canadian citizen, period,” said Zhao.
The US Securities and Exchange Commission also threw a spanner in the works when it filed an objection before the New York Bankruptcy Court on January 4.
Binance.US’s ability to consummate the US$1bn transaction was called into question by the regulator, which also took umbrage at the exchange’s “(in)sufficient detail regarding how the debtors intend to secure customer assets, including what if any safeguards will be implemented to protect against theft or loss”.
Prior to collapsing, Binance’s former rival FTX initially intended to buy the lender’s assets, before it too filed for bankruptcy following the dramatic downfall of FTX founder and crypto mogul Sam Bankman-Fried.