Binance US walks away from proposed $1bn deal for Voyager Digital assets

Binance US is abandoning its proposed $1bn acquisition of assets belonging to Voyager Digital, bringing to an end the exchange’s long-running effort to purchase the bankrupt crypto lender’s assets.

Binance US — the American arm of crypto conglomerate Binance — has sought for months to convince regulators to give the green light to the acquisition. Its efforts have run into several road blocks, including opposition from the Securities and Exchange Commission and the Committee on Foreign Investment in the US, or Cfius, an inter-agency panel that screens proposed acquisitions for national security risks.

Voyager Digital tweeted on Tuesday that it received a letter from Binance US advising of the termination. It described the decision as “disappointing”, and said the reorganisation plan in its Chapter 11 bankruptcy proceedings allowed for a direct distribution of cash and cryptocurrency to customers.

The collapse of the proposed deal represents yet another blow to the crypto industry’s efforts to establish itself in the US amid a crackdown on digital assets by American regulators.

“Any time you have a company that says it wants to go in one direction and then it has to pull the plug, that’s not good,” said one Washington lobbyist who was previously approached for a job with Binance.

Earlier this year, Binance chief executive Changpeng Zhao said the company intended to pull back on potential investments in the US as a result of a regulatory push from several American watchdogs that have trained their sights on crypto business.

Binance has long claimed that its American affiliate licenses its technology but remains an independent entity. However, links between the two exist, including Zhao, who remains the ultimate beneficial owner behind Binance US.

Earlier this year US regulators sued Binance, alleging much of its reported trading volume and profit came from access to US customers, undermining the group’s longstanding claims that both entities are separate.

Last month, the Financial Times revealed Binance hid substantial ties to China for several years, including an office in Shanghai and one Chinese bank that was used to pay some employee salaries.

Binance US said the “hostile and uncertain regulatory climate in the United States has introduced an unpredictable operating environment”.