Federal and state officials are reviewing US’s proposed agreement to buy the assets from the bankrupt cryptocurrency brokerage Voyager Digital. The Securities and Exchange Commission (SEC) and New York’s financial watchdog raised resistance to the $1 billion deal in a series of court documents filed on Wednesday.
But, the SEC isn’t too fond of this notion. It asserts that the transactions required to disperse the assets owned by Voyager clients might be in violation of the agency’s regulations prohibiting the sale or issuance of unregistered securities. Also, the agency raises a number of issues with the transaction and claims that Binance.US “inadequately describes whether third parties” will have access to consumer wallets.
Another complaint has been filed by the New York Department of Financial Services (NYDFS), stating that Voyager operated “illegally” and without a license in the state and “deprived” New York clients of the consumer protections provided by the state’s regulation. It also mentions that New York residents who utilize the Voyager service may have to wait longer to receive their funds than residents of other states since Binance.US is neither licenced nor accessible there.
The NYDFS adds that “New York Account Holders will not have any control over the assets in their accounts, including the decision to sell the crypto to reduce further risk in the highly volatile cryptocurrency market. Contrarily, Account Holders in nations other than Unsupported Jurisdictions (referred to as “Supported Jurisdictions”) will be free to trade the cryptocurrency owed to them, marked as “Net Owed Coins” in the APA, when their Binance US accounts are set up and their assets are relocated.
With the closure of FTX and the arrest of the company’s co-founder, federal and state officials are starting to focus in on crypto businesses, so it’s likely that they’ll push back even harder in the future. The SEC has asked businesses to record whether they have had any contact with troubled crypto firms, while the Federal Trade Commission has launched investigations into a number of cryptocurrency firms over alleged wrongdoing.
