Galaxy Digital Terminates the Acquisition of BitGo

Key Takeaways:

  • Galaxy Digital has terminated its $1.2 billion acquisition of BitGo, referencing the crypto custody firm’s failure to produce audit  2021 financial reports by closing.
  • The update also stated that there is no cancellation fee.

The first $1 billion deal in the cryptocurrency sector, declared at the peak of the record surge in token prices, is dissolving as the market partially overturns the gains.

Galaxy Digital announced the cancellation of its long-awaited buyout of cryptocurrency custodian BitGo.

According to a press release, Galaxy decided in response to BitGo’s “failure to deliver audited financial statements for 2021 that comply with the requirements of our agreement by July 31, 2022.” 

“Galaxy remains well-positioned for success and to take advantage of new strategic opportunities for long-term growth. We are committed to continuing our listing process in the United States and providing our clients with a premier solution that truly makes Galaxy a one-stop shop for institutions,” Galaxy CEO and Founder Mike Novogratz stated

Galaxy Digital said in a public statement that BitGo’s alleged failure to submit the financial information by July 31 contravened the conditions the two businesses had agreed upon last year. It also added that the deal’s termination wouldn’t cost the business any money.

The company is currently reorganizing to become a Delaware-based business, allowing it to list on the Nasdaq exchange, provided regulatory approval is received. Under the ticker GLXY, it is traded on the Toronto Stock Exchange.

Galaxy also focuses on launching new products, including its upcoming offering, Galaxy One Prime. Targeting institutional investors, Galaxy One Prime provides services like trading, lending, and derivatives alongside access to qualified custody that integrates “qualified blue-chip custodians.”

The announcement of the failed merger comes just one week after Galaxy Digital reported a second-quarter loss of $554 million. Despite the losses, the company keeps raising money with the intention of closing deals.

After the earnings report, Novogratz said in a conference call with The Block’s analysts, “I want to be offensive, and we’re looking.” A recent report from research indicates that M&A transactions are on track to have a record year.

Galaxy Digital Terminates The Acquisition Of Bitgo
Galaxy Digital’s second-quarter loss

In March, Goldman Sachs and cryptocurrency merchant bank Galaxy Digital reported that they had traded a non-deliverable option, a bitcoin-linked instrument (NDO).

This is a major American bank’s first OTC cryptocurrency transaction. As Goldman Sachs broadens its cryptocurrency offerings, it is the first OTC cryptocurrency transaction, illustrating banking institutions’ continued development and acceptance of digital assets.

Aadrika Sharma
Aadrika Sharma

I enjoy writing and try to learn new things every passing day!

Newsletter

Crypto News, NFTs and Market Updates

Can’t find what you’re looking for? Type below and hit enter!