U.S. Bankruptcy Judge Michael Wiles made the comments at a court hearing in New York on March 2.
The Voyager Digital restructuring plan would involve the sale of just over $1 billion worth of its assets to Binance.US. However, the SEC has opposed the deal claiming that it violates securities laws.
When questioned about the reasoning behind the opposition, SEC attorney William Uptegrove failed to provide a definite answer, according to Reuters.
In its typical vague approach, the SEC attorney said, “we can’t take a position at this point,” before adding, “the SEC is a deliberative body, and its process is a nonpublic one by federal law.”
Judge Wiles wasn’t too impressed with this response:
“Deliberative is one thing, but what have you done? If there are reasons to be concerned here, I need to hear specifics.”
SEC Crypto Warpath Continues
The SEC has ramped up its war on crypto this year and appears to be “carpet bombing” the entire industry. Gary Gensler and his team are convinced that every crypto asset aside from Bitcoin is a security.
In this specific case, the regulator claims that Voyager’s VGX sale violated securities laws but has yet to provide specifics.
If the Voyager Binance deal is approved by Judge Wiles, the sale of assets cannot close until there is final approval from the SEC and the Committee on Foreign Investment in the United States (CFIUS), both of which are in opposition.
Addressing the counsel for the SEC, Judge Wiles continued, “you come here and tell me … that I should stop everybody in their tracks because you might have an issue,” adding, “it’s kind of a weird objection.”
“I get the feeling that this objection has been made as a kind of cover, so you can say later that we’ll see we raised these issues,”
Voyager Customers in Favor
According to Voyager attorney Christine Okike, it is estimated that the sale will allow customers to recover around 73% of the value of their deposits at the time of the crypto lender’s bankruptcy filing.
A recent survey of Voyager account holders with claims revealed that 97% of them were in favor of the restructuring deal.