The Department of Justice has filed a request to put a halt to the proposed USD 1 billion deal between Binance.US and Voyager, citing legal concerns that the deal could absolve Voyager and its staff from past or future breaches of tax or securities laws.
The U.S. Trustee, a branch of the Department of Justice that is responsible for bankruptcy cases, filed the appeal. The objection comes after New York bankruptcy judge Michael Wiles approved the deal last week, despite skepticism from the Securities and Exchange Commission about Voyager’s VGX token being an unregistered security.
In response to the DOJ’s appeal, U.S. Attorney Damian Williams argued that nothing in the Bankruptcy Code allows courts to exculpate parties from liability to the government for past or future conduct. Williams also stated that the court should not approve the deal, or at least the parts that limit the government’s ability to enforce the law, until the appeals are dealt with in higher courts.
The legal objection by the U.S. government could potentially delay the proposed acquisition, which would involve Binance.US buying assets of Voyager. The deal would enable Binance.US to become a publicly listed company, and it would offer a way for the exchange to expand its offerings in the United States.
US regulators increase scrutiny on cryptocurrency industry, as seen in the DOJ’s appeal to halt the Voyager-Binance.US USD 1 billion deal. SEC Chairman Gensler also plans to tighten cryptocurrency trading platform regulations. Regulators aim to hold companies accountable for legal breaches.