Recently, Judge Michael Wells commented that he would not allow the SEC to target Voyager’s restructuring advisors over their plans to implement their bankruptcy plan. The SEC has repeatedly filed objections to the bankrupt company’s efforts to restructure, as well as to the proposed $1 billion acquisition by Binance.US

The SEC Won’t Be Allowed to Target Voyager For Its Restructuring Efforts

On the third day of the ongoing debate on Voyager’s restructuring plan, Michael Wlles, the bankruptcy judge, stated he would not allow the SEC to target the company’s efforts to repay its customers, nor to fine its advisors.  The two main parts of Voyager’s plan—the issuance of new tokens, and the acquisition by Binance.US—have proven highly controversial with the regulators.

The Securities and Exchange Commission is contending that the issuing of new tokens would, in fact, constitute an unregistered securities offering and should thus not be permitted. Furthermore, the SEC is contending that bankruptcy protections, as they stand, are so broad that they would permit Voyager to violate securities laws.

Additionally, New York state regulators are also on board with the SEC’s objections. According to Attorney General Letitia James and the NYDFS, Voyager violated state laws as it offered its services to the state’s residents without properly registering. Furthermore, they allege that the plan is seeking to take advantage of New York residents as they will not be able to reclaim their digital assets for at least six months as Binace.US has yet to receive approval from the state.

Voyager’s Troubled Bankruptcy

Ever since it filed for bankruptcy last July, Voyager Digital has been faced with numerous additional hurdles and misfortunes. The initial offers to acquire the firm’s assets have been contentious and Voyager called FTX’s first offers “not serious”. The firm’s fortunes seemingly changed by late summer as the news of renewed offers caused its token—VGX—to surge significantly.

By late September, an apparent resolution to the issue was found after FTX offered $1.4 billion in exchange for the bankrupt company’s assets and customers. Voyager, however, soon suffered another setback after massive wrongdoings on FTX’s were uncovered causing Sam Bankman-Fried’s exchange to also file for chapter 11 protection.

The sage continued even after Binance.US entered into an agreement to acquire Voyager for $1 billion in mid-December as the SEC was quick to file a limited objection to the deal—an objection that, albeit in an amended form, is yet to be resolved. More recently, it was also revealed that the FTC itself has concerns over the acquisition and is investigating Voyager for what it alleges represents the misleading of investors with deceptive marketing.

This article originally appeared on The Tokenist

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