According to a court document filed on February 24th, the Texas State Securities Board and the Department of Banking are opposing a planned agreement between Binance.US and insolvent crypto lender Voyager Digital.
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The document claims that Binance.terms US’s of service and restructuring plan include a number of “inadequate” disclosures, including failing to properly inform unsecured creditors that, under the plan, they may only get 24%–26% recovery compared to the 51% they would receive under Chapter 7. A deal to purchase the assets of Voyager for $1.022 billion was made public by Binance.US in December.
The filing also states that the company’s disclosure statement fails to inform customers that the transfer of “personally sensitive information to any party in any part of the world as required by Binance.US, and then strips the account holders of any legal recourse for any issues that may arise.”
Unfair Discrimination Against Texas Customers
The filing states that “under these ToUs, customers’ information can be transferred to almost any company or person that Binance.us desires, and, if any issues arise in the customers’ access to or use of Binance.us’s Services, the customers have absolutely no right to challenge the issue.” Furthermore, the proposal claims that it “unfairly discriminates against Texas consumers.”
Clients in Texas would have their cryptocurrency held by Voyager for six months following the agreement because Texas is not an approved jurisdiction by Binance.US. During this period, Binance.US would pursue licensing in the state.
However, the complaint asserts that “It will be almost impossible for Binance.us to be licensed by the Texas SSB and the DOB within six months and, as such, holding the Texas consumers’ coin for six months accomplishes nothing.”
A few days prior, the Securities and Exchange Commission (SEC) filed in a bankruptcy court in New York claiming that certain elements of the restructuring plan violated securities law.
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