Voyager Digital Bankruptcy Drama: Legal Showdown Over Sale to Binance.US

What’s Cooking in Bankruptcy Court?

It seems that bankruptcy court is turning into a soap opera, and the latest episode revolves around Voyager Digital. U.S. officials, led by trustee William Harrington, are throwing a wrench into the works as they seek to nix a provision that protects those involved in the company’s proposed asset sale to Binance.US from personal liability.

The Controversial Exculpation Provision

The hot topic? An exculpation provision that was approved on March 7, which essentially means that if things go south during the sale, the individuals involved can’t be held accountable. This decision followed a report indicating that a whopping 97% of Voyager customers were on board with the plan. Talk about a fan club!

Government’s Stance

However, the government isn’t throwing confetti. They argue that this provision would limit their ability to enforce laws and hold individuals accountable. The motion filed on March 14 requested a two-week delay on the court approval so they could prepare an appeal. Because, of course, who doesn’t love a cliffhanger?

SEC Joins the Party

As if things weren’t spicy enough, the U.S. Securities and Exchange Commission (SEC) also stepped in. They took the stance that this whole repayment token being offered in the sale might actually be an unregistered security, adding another layer of complexity to this bubbling cauldron of legal battles. One SEC official even described the exculpation provision as “extraordinary and highly improper.” Who said court proceedings lacked drama?

Awaiting the Next Episode

Today, March 15, there’s a hearing scheduled for 2:00 pm Eastern Time. With the stakes high and a potential recovery of 73% for Voyager creditors on the line, one can only wonder how this saga will unfold. Buckle up, folks; it’s about to get wild!

The Ripple Effects

This case is already shaking the foundations of trust and regulation in the crypto world. With digital assets becoming more mainstream, the decisions made in these proceedings will likely have implications far beyond Voyager and Binance.US.

What Happens Next?

• Will the court side with the U.S. officials and delay the sale?
• Can Voyager creditors finally see some recovered funds?
• Who else might jump into this digital waltz of legalities?