On 19 December, Voyager Digital Ltd, a cryptocurrency company, announced that it would be selling its assets to Binance.US in a deal that is estimated to be worth around $1 billion. After conducting a review, the Palo Alto-based Binance.US, which operates as a separate legal entity with a licensing agreement with Binance.com, will make an initial deposit of $10 million and reimburse Voyager for specific expenses up to $15 million. The purchase price will include $20 million in addition to reimbursements to Voyager’s customers, while the majority of the $1 billion valuation comprises the debt that Voyager owes to its clients. This move is significant for both companies as it will allow them to leverage each other’s strengths and expertise to provide better services to their clients while also expanding their market reach. It seems that Voyager Digital is now moving toward selling its assets as an on-chain firm, Lookonchain, revealed that Voyager has been selling crypto assets since 14 February through the crypto exchange Coinbase.
Voyager Proceeds To Selloff Crypto Assets
According to reports, Voyager Digital, a centralized finance (CeFi) platform that filed for Chapter 11 bankruptcy in July 2022, is selling assets through the Coinbase crypto exchange. On-chain data indicates that Voyager received a minimum of $100 million in USD Coin over a period of three days beginning on 24 February. Lookonchain, an on-chain analyst, alleges that Voyager has been sending crypto assets to Coinbase almost daily since Valentine’s Day on 14 February. The investigation reveals that Voyager has transferred millions of dollars using a variety of cryptocurrency tokens, including Ether, Shiba, and Chainlink.
The utilization of 23 tokens worth more than $100 million by Voyager was disclosed by Lookonchain. Nonetheless, Coinbase has not yet issued a response to verify the validity of the assertion. Voyager continues to hold almost $530 million in cryptocurrency, even after the selloff, with Ether ($276 million) and Shiba Inu ($81 million) comprising the biggest portions.
SEC’s Scrutiny Becomes A Trouble Amid Voyager’s Massive Selloff
Binance.US’s proposed acquisition of the assets of defunct crypto lender Voyager Digital for $1.02 billion has been met with opposition from both federal and New York finance regulators, who filed on 22 February citing potential discrimination and illegality. This development comes amid heightened scrutiny of the cryptocurrency industry by the Securities and Exchange Commission, with their investigations into alleged sales of unregistered securities recently leading to Kraken ceasing crypto staking operations in the United States.
In a filing on Wednesday, the SEC raised concerns that the Voyager deal may breach laws relating to the unregistered offer and sale of securities. The objection also referred to reports of ongoing investigations by U.S. authorities into Binance.US and its purportedly independent partner, the global Binance crypto exchange. The SEC warned that the regulatory scrutiny could potentially render the deal “impossible to consummate.”
According to a filing made on 22 February to the U.S. Bankruptcy Court for the Southern District of New York, the SEC indicated that Binance.US had not shown evidence that it could carry out asset sales while adhering to federal securities laws. The filing raises doubts about the legality and feasibility of the proposed asset restructuring through acquisition and whether Voyager debtors can recover any of their assets in the wake of the company’s bankruptcy.
