Binance.US is not buying Voyagers crypto assets for $1.02 billion. Here’s what’s really going on.

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Binance.US CEO Brian Shroder

Binance.FR

Several reports this morning suggest that Binance.US, the US franchise of the world’s largest crypto exchange, Binance, is buying the assets of embattled crypto lender Voyager Digital for $1.02 billion.

That’s not quite what’s happening.

Binance.US’ bid, which was selected by Voyager, will only see around $20 million transferred into bankruptcy. The rest comes from what a Voyager press release calls current market prices for its assets, noting that the final value will be set in the future.

A better way to view the deal may be to think of the $20 million that will be sent by Binance.US as the purchase price for the right to acquire 3.5 million Voyagers client accounts. Once those funds are transferred and then distributed to customers, which won’t happen until the bankruptcy court decides what pro rata share each account will receive, it will be up to Binance.US to try to keep customers and their assets on the platform.

Voyager will seek bankruptcy court approval to enter into the asset purchase agreement at a hearing on January 5. The sale will be conducted pursuant to a Chapter 11 plan, which will be put to a vote by creditors. A source familiar with the deal suggests that the funds will not be transferred to Binance.US until March.

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The structure of this agreement is similar to the September agreement between Voyager and FTX.US, the American subsidiary of the FTX crypto exchange, which would have sent $ 51 million to Voyager in exchange for the transfer of what was worth to the 1.422 billion dollars of crypto to FTX. . Binance participated in the initial auction process over the summer, offering to acquire the assets for $50 million. Voyager ended up accepting a similar offer from FTX, which significantly increased its offer from an initial offer of $15 million.

The deal appears to be part of Binance.US’ cost-focused efforts to grow and acquire customers after the exchange recently waived trading fees on bitcoin and ether, the two most popular cryptocurrencies. .

Voyagers native token VGX rose almost 40% after the winning bid was announced this morning. He has since returned nearly half of those winnings.

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