SEC lawyer says Binance.US runs unregistered exchange, Voyager tokens should be regulated

An SEC lawyer has stated that both parties involved in Voyager Digital’s bankruptcy case come under securities regulations, according to a Bloomberg report on March 3.

Binance.US, Voyager face securities regulations

William Uptergrove, a U.S. Securities and Exchange Commission lawyer, said that SEC staff believe Binance.US operates an unregistered securities exchange.

Binance.US is currently attempting to purchase the assets of Voyager Digital, a course of action that the SEC objected to as early as January. Binance.US additionally faces an SEC investigation, according to earlier court proceedings cited by Bloomberg.

Uptergrove also said that Voyager’s planned recovery token should be regulated as a security — which would put the assets under the SEC’s jurisdiction.

Uptergrove’s statements are not public and do not represent the view of the SEC as an entity. However, his statements carry weight as they represent the view of SEC staff — that is, they do not merely represent his personal views.

Voyager bankruptcy proceedings continue

Previously, on March 2, the judge responsible for the case criticized the SEC’s objections to the deal. U.S. Bankruptcy Judge Michael Wiles said that the regulator had “stop[ped] everybody in their tracks” without providing a way to respond to its concerns.

At that time, Uptergrove refused to take a stance on whether the sale of Voyager’s assets violated securities laws. The judge insisted on a more specific answer.

In response to the increasingly complex situation, Binance CEO Changpeng Zhao floated the possibility of abandoning the deal on March 3. He wrote on Twitter: “maybe we should pull out?” He nevertheless expressed support for the deal if it is ultimately permitted.

Binance.US’s purchase of Voyager assets must be allowed by the SEC even if the deal is approved by all other parties — including the companies, creditors, and the judge.

Voyager customers voted overwhelmingly in favor of the plan on March 1.