BitGo Cancels Acquisition of Troubled Crypto Custody Firm Prime Trust
Crypto Custody Firm BitGo Cancels Acquisition of Rival Prime Trust
• Crypto custody firm Prime Trust has been facing financial troubles and lost customers this month.
• BitGo reached a preliminary agreement to acquire the firm, but cancelled the process after „considerable effort and work to find a path forward with Prime Trust.“
• The Nevada Financial Institution Division has ordered Prime Trust to cease all activities, leading other crypto exchanges like Stably and Coinmetro unable to process new USD transactions.
Background on Prime Trust Troubles
Prime Trust has had a difficult few months. It replaced CEO Tom Pageler in November, let go around one third of its staff in January, and saw its subsidiary Banq file for bankruptcy last week. Additionally, it’s been losing clients and deposits to competitors for weeks amidst mounting concerns over its business.
BitGo Terminates Acquisition Agreement
Due to these mounting concerns, crypto custody firm BitGo had entered into a preliminary agreement to acquire Prime Trust for an undisclosed amount earlier this month. However, they have since ended the process after „considerable effort and work“ finding a path forward with the company. Despite terminating the agreement, they remain committed to their mission of providing trust in digital assets.
Nevada Financial Institution Division Orders Cease of Activities
The Nevada Department of Business and Industry issued an order for Prime Trust to halt all activities which violate regulations due to having “a shortfall in customer funds” and being unable to meet withdrawal requests this month. This led other crypto exchanges like Stably and Coinmetro unable to process new USD transactions as well.
Prime Trust is currently facing significant financial issues leading cryptocurrency exchanges like Stably & Coinmetro unable able process new USD transactions while BitGo terminates their acquisition agreement amid mounting concerns over the firm’s business operations