Binance US Pulls the Plug: Voyager Purchase Deal Falls Through

April 25, 2023 Bitcoin.com

Voyager’s $1B deal with Binance.US moves forward after deal with Feds

April 20, 2023 Coin Telegraph

Bitcoin price holds its ground in the wake of CFTC case against Binance

March 28, 2023 Coin Telegraph

BTC options and derivatives markets seem unfazed by the CFTC’s recent action against Binance, but is that a good or a bad sign?

The price of Bitcoin (BTC) fell 3.6% to $26,900 after Binance and CEO Changpeng "CZ" Zhao were sued by the United States Commodity Futures Trading Commission (CFTC) on March 27. To date, Binance has been investigated by the CFTC, the US Securities and Exchange Commission (SEC), the Internal Revenue Service and federal prosecutors.

The Bitcoin price correction may have been limited due to Silicon Valley bank’s successful asset sale to First Citizens BancShares at a $16.5 billion discount, which received an extraordinary credit line from the Federal Deposit Insurance Corporation (FDIC) to compensate for potential future losses.

Oil prices also increased by 5% on March 27 after Russian President Vladimir Putin escalated geopolitical tensions in Europe. According to Yahoo!Finance, Russia plans to station tactical nuclear weapons in neighboring Belarus, in a move designed to intimidate the opposing countries over its support for Ukraine.

Further tension from the crypto industry arose after a U.S. Federal Judge decided to temporarily halt the proposed sale of Voyager Digital to Binance.US. on March 27. Judge Jennifer Rearden of the U.S. District Court in New York granted the request for an emergency stay.

Let's examine Bitcoin derivatives metrics to determine the current market position of professional traders.

Bitcoin futures show no impact from the CFTC-Binance case

Bitcoin quarterly futures are popular among whales and arbitrage desks, which typically trade at a slight premium to spot markets, indicating that sellers are asking for more money to delay settlement for a longer period.

As a result, futures contracts on healthy markets should trade at a 5% to 10% annualized premium — a situation known as contango, which is not unique to crypto markets.

*Bitcoin 2-month futures annualized premium. Source: Laevitas.ch*

The Binance news had no effect on the Bitcoin futures premium, despite the fact that the exchange holds 33% of the $11.2 billion open interest. The 2-month contract premium is 3.5%, which is less than the neutral 5% threshold. Had there been some panic selling using leverage futures contracts, the indicator would have quickly moved to 0 or even negative.

The absence of demand for leverage longs does not necessarily imply a price decline. As a result, traders should investigate Bitcoin's options markets to learn how whales and market makers value the likelihood of future price movements.

Bitcoin options traders remain slightly optimistic

The 25% delta skew is a telling sign showing when market makers and arbitrage desks are overcharging for upside or downside protection. In bear markets, options investors give higher odds for a price dump, causing the skew indicator to rise above 8%. On the other hand, bullish markets tend to drive the skew metric below -8%, meaning the bearish put options are in less demand.

*Bitcoin 60-day options 25% delta skew: Source: Laevitas*

The 25% skew ratio stands at -5, indicating that the protective put options are trading at a slight discount, confirming the Binance news' irrelevance. More importantly, the CFTC action had no effect on the 25% skew, so whales and market markets are not pricing in any meaningful market structure change.

What doesn't kill you makes you stronger

The fact that derivatives indicators were barely impacted could be the “remote misses” effect as analysis and pundits evaluate the odds of Binance and CZ getting anything more than a million-dollar fine and some term of conduct adjustment.

This type of psychological distortion was first observed in London during WWII, when survivors who did not face imminent losses became even more confident and less likely to feel traumatized.

It appears unlikely that the market will price in higher odds of extreme volatility until those whales and arbitrage desks face more than a 3.5% price correction.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.

Voyager’s $1B sale to Binance.US put on hold by US court

March 28, 2023 Coin Telegraph

<div>Voyager's B sale to Binance.US put on hold by US court</div>

Appeal

A federal judge has temporarily halted a proposed deal between Voyager and Binance.US in order to give the government more time to pursue appeals that challenge the deal.

Voyager Digital’s $1 billion sale to Binance.US has been temporarily halted by a federal judge after a request by the United States government for an emergency stay.

The request for an emergency stay was granted by Judge Jennifer Rearden of the U.S. District Court in New York on March 27, meaning the potential deal between Voyager and Binance.US will now need to wait until at least a decision is made on the Department of Justice’s appeal against the bankruptcy plan.

*District Court Judge Jennifer Rearden granted approval of the U.S. DOJ’s emergency motion. Source:* *Court Listener*

The DOJ filed the emergency application for a stay on March 17. This motion was promptly challenged by Voyager Digital and the Official Committee of Unsecured Creditors on March 20 and responded to again by the DOJ in a final “reply” motion on March 21.

In its latest order, Judge Rearden summarized:

“Upon consideration of all parties’ written submissions, as well as the conferences and oral argument held in this matter, the Government’s emergency motion is hereby GRANTED.”

The federal judge will soon release an opinion explaining the decision in more depth.

The cryptocurrency trading firm filed for Chapter 11 bankruptcy on July 5 and has been proactive in coordinating a plan to redistribute funds ever since.

The Binance.US acquisition of Voyager was granted by Judge Wiles on March 7. Part of that approval involved the issuance of bankruptcy tokens to impacted Voyager customers.

However, U.S. regulators have made multiple attempts have been made to halt the deal.

In addition to the DOJ, the U.S. Securities Exchange Commission argued in a March 15 motion that Voyager’s bankruptcy plan would give rise to fraud, theft or tax avoidance. However, this claim was later denied by Judge Michael Wiles.

The Voyager Official Committee of Unsecured Creditors explained in a March 27 Twitter post that they “will continue to aggressively oppose the Government’s efforts.”

3/ The Committee is still analyzing the situation and awaiting the district court's forthcoming written opinion. We will continue to aggressively oppose the Government’s efforts and will provide further updates as they become available.
— Voyager Official Committee of Unsecured Creditors (@VoyagerUCC) March 27, 2023

Over 97% of 61,300 Voyager account holders favor the restructuring plan, according to a poll released in a Feb 28 court filing. The plan is expected to pay out 73% of what Voyager customers are owed.

Magazine: Unstablecoins: Depegging, bank runs and other risks loom

270,000,000,000 Shiba Inu (SHIB) Abruptly Sent to Coinbase by Embattled Crypto Lender: On-Chain Data

March 16, 2023 The Daily Hodl

U.S. Department of Justice Appeals Court Decision Approving $1,300,000,000 Voyager Acquisition

March 11, 2023 The Daily Hodl

Voyager Liquidates 400,000,000,000 Shiba Inu on Coinbase As the Embattled Lender’s Selling Spree Gathers Steam

March 10, 2023 The Daily Hodl

US Judge Approves $1,300,000,000 Binance.US Deal With Voyager After Dismissing SEC Objections

March 9, 2023 The Daily Hodl

SEC snubbed as Voyager wins court approval for sale to Binance US

March 7, 2023 Coin Telegraph

approval

The ruling allows the crypto lender a path out of its bankruptcy, but it still has to undertake some due diligence with Binance US before the sale is final.

Bankrupt cryptocurrency lender Voyager Digital has won court approval to sell over $1 billion of its assets to Binance US.

The approval was granted by United States Bankruptcy Judge Michael Wiles on Mar. 7, which came after four days of arguments presented by Voyager and the U.S. Securities Exchange Commission (SEC).

Wiles said he would give the trading platform permission to close the Binance US sale and issue repayment tokens to impacted Voyager customers, which would give them back approximately 73% of what they're owed.

Wiles rejected a series of arguments by the SEC that the redistribution of the funds from Voyager to Binance.US would violate U.S. securities laws, according to a Mar. 7 report from Bloomberg:

“I cannot put the entire case into indeterminate deep freeze while regulators figure out whether they believe there are problems with the transaction and plan."

Peter M. Aronoff, a lawyer with the Department of Justice (DOJ) said it's considering appealing Wiles' decision.

The judge's decision comes just over a week after 97% of 61,300 Voyager account holders were found to be in favor of the current Binance.US restructuring plan, according to a Feb. 28 filing.

This is a developing story, and further information will be added as it becomes available.

US Judge Shuts Down SEC, Says Agency Will Not Be Allowed to Interfere With Crypto Bankruptcy Proceedings

March 7, 2023 The Daily Hodl

voyager