The U.S. arm of cryptocurrency exchange Binance has been prohibited by U.S. authorities from selling the assets of bankrupt crypto lender Voyager until major legal objections have been addressed.
The Southern District of New York Attorney, Damian Williams, has stated that the approval of the deal, or parts of the deal, should be postponed until appeals are heard in higher courts, as there is nothing in the Bankruptcy Code that allows courts to release parties from liability to the state for past and future actions.
The Office of Trustees, the branch of the Justice Department responsible for overseeing bankruptcies, filed an appeal against the deal just a day after federal judge Michael Wiles approved the agreement following a controversial four-day hearing marathon.
Last month, the SEC filed an objection to the purchase of Voyager, claiming that Binance.US may be violating federal securities laws.
If Voyager fails to sell its assets, the company has another option, which is a complete liquidation, resulting in much less compensation for creditors.
Voyager filed for bankruptcy in July 2022 and began to actively sell its assets from February of this year.
According to the Lookonchain analytics portal, Voyager sold 1,449 ETH through Wintermute. Sales were conducted for USDC. In total, Voyager received $2.25 million, which equates to $1,553 per ETH.