Texas Regulator has Concerns Regarding Voyager-Binance Deal
- The Texas State Securities Board and the Department of Banking have expressed concerns regarding the acquisition deal between Binance.US and Voyager.
- The terms of service and restructuring plan of Binance.US contain several “inadequate” disclosures, said the regulator.
- It was revealed on Dec. 19 that Binance.US plans to acquire the assets belonging to Voyager Digital for a total of $1.022 billion.
- The regulator stated that this plan presented by Binance.US “unfairly discriminates against Texas consumers.”
Popular crypto lending platform Voyager Digital filed for bankruptcy last year and went on to make several headlines after its acquisition deal with Sam Bankman-Fried’s crypto exchange FTX fell apart due to the latter also filing for bankruptcy in November 2022. Interestingly, the US arm of the world’s largest crypto exchange, Binance.US, came forward to acquire Voyager, but several regulators, including the Texas State Securities Board and the Department of Banking, have concerns regarding the same.
According to a court filing by the Texas regulator, the terms of service and restructuring plan of Binance.US contain several “inadequate” disclosures, including not adequately informing unsecured creditors that under the plan, they may only get 24%–26% recovery, as compared to the 51% they would receive under Chapter 7.
It was revealed via a press release published on Dec. 19 that Binance.US plans to acquire the assets belonging to Voyager Digital for a total of $1.022 billion. The crypto lender stated at that time that the crypto exchange presented the “highest and best bid for its assets.”
Further, the filing also stated that the crypto exchange’s disclosure also does not mention the fact that customers will be required to allow the transfer of “personally sensitive information to any party in any part of the world as required by Binance.US, and then strips the account holders of any legal recourse for any issues that may arise.”
“So, under these ToUs, customers’ information can be transferred to almost any company or person that Binance.us desires, and, if any issues arise in the customers’ access to or use of Binance.us’s Services, the customers have absolutely no right to challenge the issue,” noted the Texas regulator.
The regulator stated that this plan presented by Binance.US “unfairly discriminates against Texas consumers,” while adding that since the crypto exchange is not licensed to operate in the region, Voyager will hold the digital assets belonging to the account holders for six months after the agreement, during which time Binance.US would seek licensing in the state.
However, the regulator further noted, “It will be almost impossible for Binance.us to be licensed by the Texas SSB and the DOB within six months, and, as such, holding the Texas consumers’ coin for six months accomplishes nothing.”
As reported earlier by Bitnation, the first country to adopt Bitcoin as legal tender in the world, El Salvador, is set to open a Bitcoin Embassy in Texas. The state has also started an investigation into the celebrities that promoted the now-bankrupt exchange FTX, including model Gisele Bündchen, Steph Curry, and Tom Brady.Furthermore, it is also crucial to note that US Bankruptcy Judge Michael Wiles in New York has given the nod to Voyager to enter into a deal with Binance.US and also, solicit creditor votes for the same. However, US regulators have filed a motion against the acquisition of assets belonging to Voyager by the crypto exchange.
A crypto journalist with over 3 years of experience in DeFi, NFT, metaverse, etc. Parth has worked with major media outlets in the crypto and finance world and has gained experience and expertise in crypto culture after surviving bear and bull markets over the years.
