Binance’s American affiliate won court approval to take over thousands of customer accounts from bankrupt crypto platform Voyager Digital Ltd. despite warnings that the Binance.US exchange faces possible regulatory action, WSJ Pro Bankruptcy reported. Judge Michael Wiles of the U.S. Bankruptcy Court in New York approved the companies’ deal, undeterred by the revelation last Friday that Securities and Exchange Commission staff have determined that Binance.US, the American affiliate of the world’s largest crypto exchange, is operating an unregistered securities exchange. The SEC staff’s view that Binance operates an unregistered exchange in the U.S. hasn’t been affirmed by the agency’s commissioners but indicates the SEC could take enforcement action. Judge Wiles on Tuesday said he couldn’t delay the deal between Voyager and Binance.US simply because the SEC is warning about possible future enforcement, especially since the agency didn’t present any evidence the companies could rebut. “The SEC didn’t say why they say Binance.US is operating as a securities broker. If we were to try to address the issue we’d have to guess,” Judge Wiles said in his ruling. The judge’s ruling clears the way for Voyager to transfer roughly $1 billion in cryptocurrency it holds to Binance.US, where customers would receive new accounts to access some of the assets that have been frozen since Voyager filed for chapter 11 last year. In court hearings that began last week, Judge Wiles considered Voyager’s plan to sell its customer accounts to Binance.US, wind up the bankruptcy case and distribute what remains of the business to its customers. U.S. state and federal regulators have voiced doubts about the viability of the proposed deal, citing risks from pending regulatory investigations of Binance.US.
