Bankrupt Voyager Battles Alameda as the SEC Examines a $1 billion Binance Deal

Insolvent cryptocurrency lender Voyager referred to new allegations made by Alameda Research over its agreement with Binance.US as “frivolous.” Alameda made a number of complaints in a document that was published last week, claiming that the $1 billion takeover deal “ignores core obligations and protections of the Bankruptcy Code.”

In reaction, Voyager filed a document today accusing Alameda of “hypocrisy and chutzpah at its finest,” citing how the company has misled “most of the world” in addition to its debtors.

Binance's offer, which was reportedly “the highest and best bid,” was worth approximately $1.022 billion in total, including the lender's residual crypto portfolio. Voyager agreed to transfer its remaining shares to Binance.US in December, in a relocation it said that will “a clear path forward for Voyager customer funds to be unlocked as soon as possible.”

The Bankruptcy Code's Section 1129(b), which prohibits “junior class” debtors from having precedence on “their claims or interests without holders of senior classes getting the entire amount of their claims,” is the foundation of Alameda's petition.

The petition refers to the deal as “patently unconfirmable,” noting the Bankruptcy Code's disclosure rules, while pointing out that the shuttered trading company formerly helped Voyager with rescue financing.

Voyager had received a line of credit from Alameda that, prior to the crypto market crisis, was estimated to be worth $377 million. In its response from today, Voyager claimed that the firm's “fraudulent and false representations” were the only reason it engaged into this initial arrangement.

Not just the ruins of Alameda are being examined; the controversial acquisition is as well.

In a filing from last week, the SEC questioned Binance's capacity to “consummate a transaction of this magnitude.”

The regulator questioned if there was enough information “about the balancing of the Debtors' bitcoin holdings” and “on how the Debtors intend to secure customer assets.”

Prior to a hearing on the subject, the SEC recommended filing a new Disclosure Statement relating to the transaction, which the regulator has the authority to object to or change.

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