Key takeaways:
- BitGo withdrew from its tentative agreement to buy Prime Trust.
- Prime Trust has halted deposits just a few days after it reached a tentative agreement to be acquired by BitGo.
In the wake of continued issues with Prime Trust’s deposits impeding the execution of the intended acquisition, BitGo withdrew from its tentative agreement to buy Prime Trust altogether on Thursday.
According to a tweet from BitGo, the cryptocurrency business made the choice to cancel its acquisition after putting in a lot of time and effort to find a solution with Prime Trust. The company declared:
“This decision was not made lightly and BitGo remains committed to our mission to deliver trust in digital assets,”
Although the particular grounds for the termination were not stated in the tweet, this development follows the dismissal of BitGo’s lawsuit against Galaxy Digital by a US federal judge for the termination of their $100 million acquisition deal.
Prime Trust has halted deposits just a few days after it reached a tentative agreement to be acquired by BitGo, casting doubt on whether the planned acquisition will be completed in the near future.
The parent company of Prime Trust, Prime Core Technologies, was the subject of an earlier June 9 announcement by BitGo Holdings that it had entered into a non-binding agreement to purchase all of its equity. Business continuity and long-term stability will be provided to Prime Trust clients, according to the corporation.
The US-based cryptocurrency startup Prime Trust, which specializes in on- and off-ramps from fiat money to digital assets, announced in 2018 that it was also going to offer services for other cryptocurrencies as well. The company claims to have worked with approximately 700 fintech and cryptocurrency clients.
Over the past few weeks, Prime Trust has encountered financial difficulties. In its bankruptcy filing on June 14, Banq, a division of Prime Trust, listed assets at $17.72 million and liabilities at about $5.4 million.
The company, on the other hand, recently lost several clients, including Binance US, which was previously sued by the US Securities and Exchange Commission, allegedly for allegedly violating the country’s securities laws, among other things.
In April, Binance US backed out of its agreement to purchase $1 billion of bankrupt cryptocurrency brokerage Voyager Digital assets. It blamed the move on the hostile and uncertain regulatory climate in the United States.
