Binance Reverses Course and Abandons $1 Billion Voyager Deal

Crypto exchange Binance.US has terminated its agreement to purchase bankrupt crypto firm Voyager Digital.

The move comes just days after federal regulators dropped their ongoing efforts to halt the deal.

The exchange gave no explanation for its decision in a court filing from Tuesday (April 25) announcing the termination that was sent by Binance.US to Voyager. Binance.US did request the return of its $10 million deposit within three days.

In an equally brief court filing, Voyager acknowledged the deal termination and indicated that it may pursue a reverse termination fee owed by Binance.US.

“While this development is disappointing, our chapter 11 plan allows for direct distribution of cash and crypto to customers (a “toggle option”) via the Voyager platform,” tweeted Voyager in response to the news. “Consistent with the plan, we will now move swiftly to return value to customers via direct distributions. We will provide more information on next steps and any actions customers need to take in the coming days.”

Read more: Crypto Crackdown Continues as SEC Protests Binance/Voyager Deal

As PYMNTS reported, the Binance.US — which is a separate entity from Binance Holdings, but like that organization is majority owned by Changpeng Zhao — had faced steep criticism from the Texas State Securities Board, the U.S. Securities and Exchange Commission (SEC), New York Department of Financial Services (NYDFS), and the U.S. Federal Trade Commission, as well as many lawmakers, as it worked to move forward on the transaction that was first announced Dec. 18.

“We look forward to bringing Voyager customers to Binance.US, and are pleased that 97% of Voyager customers have already voted to approve our plan,” a Binance spokesperson told PYMNTS at the time.

 “Under the terms of the asset purchase agreement, Binance.US is required to destroy all customer information that it has received and permanently close and remove any accounts established with Voyager customer information,” Voyager tweeted Tuesday (April 25).

Voyager Digital originally filed for Chapter 11 bankruptcy protection in July, saying in its filing before the bankruptcy court for the Southern District of New York that it was “facing a short-term ‘run on the bank’” after a borrower defaulted on a $650 million loan.

The termination of the Binance.US deal is the second failed deal for Voyager, which has been trying to exit bankruptcy and repay its customers for nearly nine months.

Last September, crypto exchange FTX won the initial auction for Voyager’s assets. Barely two months later, FTX would itself go bankrupt.