U.S. SEC attorney points out that Binance.US may be an unregistered stock exchange

Voyager Acquisition Hearing for Binance.US

The US cryptocurrency exchange Binance.US held a hearing on the 2nd regarding its acquisition of the assets of the bankruptcy-filed cryptocurrency investment platform Voyager Digital.

SEC lawyers disputing the deal have cited Binance.US as a possible “unregistered stock exchange” as evidence. In addition, it added that Voyager’s past sale of VGX tokens may violate federal securities laws.

Judge Michael Wiles, however, is strongly skeptical of the SEC’s allegations, saying they lack specificity.

Voyager Digital filed for Chapter 11 (Chapter 11) bankruptcy protection in July 2022. Binance.US won the bid in December 2022, offering a price of approximately 140 billion yen ($1.02 billion) for the sale of Voyager’s assets. However, the SEC has filed an objection.

A hearing on the Voyager deal by Binance.US held in New York’s Southern District Bankruptcy Court on Thursday focused on the SEC’s grounds for objection. SEC senior trial attorney William Uptegrove said:

“Given the currently known facts and circumstances, the SEC staff believes that the offering and sale of VGX tokens has the attributes of securities trading. We believe we operate a registered stock exchange.”

William’s statement speaks for itself as an SEC staff member. It does not reflect the views of the SEC’s five commissioners (one chairman and four commissioners), he added. be done). He added that the SEC “has not taken any decision to enforce any regulatory action” regarding William’s remarks.

Meanwhile, US District Judge Michael Wiles of the Bankruptcy Court said, “The SEC has failed to provide a detailed basis for its objection to the Voyager transaction.” He also expressed skepticism about SEC lawyers’ view that VGX tokens could become unregistered securities.

In justifying VGX as a security, SEC’s Uptegrove cited that “creditors weren’t sufficiently warned of regulatory risks,” but offered no other clear observations. The SEC is also conducting a separate investigation into allegations of exaggeration in Voyager’s marketing tactics.

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Voyager creditors agree

At the same hearing, Voyager attorney Christine Okike estimated that the asset sale agreement could recover 73% of client assets in bankruptcy filings. Already, 97% of Voyager’s creditors have voted in favor of the deal.

According to documents filed by Voyager Digital’s lawyers, Binance.US has prepared a cash payment of approximately ¥2.6 billion ($20 million) and a maximum surrender value of approximately ¥2 billion ($15 million) as compensation to debtors. is required.

At a hearing held in January, a federal district judge approved Binance.US’ solvency based on information provided by Voyage.

The transaction is subject to final approval from the SEC and the Commission on Foreign Investment in the United States (CFIUS), and while CFIUS has not formally objected to the sale of the assets, it is subject to an “ongoing review of national security concerns.” could ultimately block the deal,” he warned.

Binance.US claims to be a “fully independent entity” from the global version of Binance, whose CEO is CZ (Changpeng Zhao), a Canadian born in China.

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