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The
proposed deal may violate laws on the unregistered offer and
sale of securities, the SEC said in a filing on Wednesday. It
also cited news reports of U.S. investigations into the global
Binance crypto exchange, of which Binance.US is a purportedly
independent partner, that mean the deal could become "impossible
to consummate."
New York's top financial regulator and New York Attorney General
Letitia James also objected to the deal in filings on Wednesday.
The New York Department of Financial Services said that Voyager
"illegally operated a virtual currency business within the state
without a license."
Binance.US and a lawyer representing Voyager Digital did not
immediately respond to Reuters requests for comment.
The objections come as the SEC targets companies offering a
range of crypto services, from stablecoins to "staking." It told
the issuer of Binance's stablecoin, Paxos Trust Company, that it
should have registered the product as a security and is
considering taking action against it, Paxos said last week.
The U.S. Justice Department is investigating the global Binance
exchange for possible money laundering and sanctions violations,
Reuters reported in December. A top Binance executive last week
told the Wall Street Journal that Binance expected to pay
penalties to resolve the investigations.
Voyager filed for bankruptcy in July, one of a string of crypto
companies caught in the 2022 collapse in token prices.
Voyager received initial court approval for the deal last month.
A U.S. national security review could delay or block the deal,
the U.S. Committee on Foreign Investment in the United States
said in a court filing in December.
(Reporting by Yana Gaur in Bengaluru; Editing by Devika Syamnath
and Bernadette Baum)
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