The US Securities and Exchange Commission (SEC) has rejected Binance’s US subsidiary’s request to purchase more than $1 billion worth of assets from the insolvent cryptocurrency company Voyager.
The securities regulator contends that Voyager’s Asset Purchase Agreement (APA), which is required in chapter 11 cases, and disclosure statement are missing some crucial details in a filing with the U.S. Bankruptcy Court Southern District of New York.
According to the SEC, the APA omits details on Binance US’s capacity to close the $1.022 billion deal and the nature of its post-acquisition business operations.
Additionally, the contracts don’t include enough details about how the assets of the clients would be safeguarded.
“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 by both the Debtors, during the implementation of the plan process, and Binance US, after its acquisition of assets.”
The disclosure document, according to the SEC, does not go into enough information about rebalancing Voyager’s bitcoin holdings.
“In addition, the Disclosure Statement should be revised to make clear that rebalancing will occur not just in a liquidation scenario but also in the context of a sale transaction.”
Voyager revealed in December that Binance US had offered the highest offer for its assets. If the bankruptcy court approves, the business anticipates completing the arrangement by April.
“Binance.US intends to put down a $10 million deposit and reimburse Voyager for unspecified expenses up to $15 million with the expectation of closing the deal by April 18, 2023, per Voyager.”