Crypto Custody Provider BitGo Ditches Plan to Acquire Rival Prime Trust

<p>Digital asset custodian
BitGo has shelved its planned <a href="https://www.financemagnates.com/terms/a/acquisition/">acquisition</a> of rival Prime Trust despite preliminary agreement reached earlier in the month. The initial takeover
agreement came amid speculation that Prime Trust was
facing bankruptcy. </p><p>BitGo Shuns Prime Trust
Takeover</p><p>“After considerable
effort and work to find a path forward with Prime Trust, BitGo has made the
hard decision to terminate its acquisition of Prime Trust,” the
California-based firm said in a Twitter post published today (Thursday). “This
decision was not made lightly and BitGo remains committed to our mission to
deliver trust in digital assets.”</p><blockquote><p lang="en" dir="ltr">After considerable effort and work to find a path forward with Prime Trust, BitGo has made the hard decision to terminate its acquisition of Prime Trust. This decision was not made lightly and BitGo remains committed to our mission to deliver trust in digital assets.</p>— BitGo (@BitGo) <a href="https://twitter.com/BitGo/status/1671869979321577472?ref_src=twsrc%5Etfw">June 22, 2023</a></blockquote><p>The speculation about Prime
Trust’s health was fueled by recent developments at the
Nevada-based firm. In January, the firm <a href="https://support.primetrust.com/hc/en-us/articles/12311667597083-What-is-happening-" target="_blank" rel="follow">quit service provision in
Texas</a> after previously
withdrawing its Texas Money Transmitter License (MTL) application. In the same
month, the crypto custodian shredded one-third of its workforce, mostly
staff members in the communications and <a href="https://www.financemagnates.com/terms/c/compliance/">compliance</a> departments, according to
CoinDesk. </p><p>Last week, Banq, a
mobile software solutions provider and subsidiary of Prime Trust, filed for <a href="https://www.financemagnates.com/tag/bankruptcy/" target="_blank" rel="follow">bankruptcy</a>
in a US court in Nevada, declaring $17.72 million in assets and $5.4 million in
liabilities. Prime Trust itself was initially primed for a $1.2 billion
acquisition by Galaxy Digital by late 2021. However, the deal fell apart in
August last year, with Prime Trust’s claim of
$100 million in damages later dismissed by a court in Delaware.</p><p>Prime Trust Stops Deposit </p><p>Meanwhile, Prime Trust
has ceased all deposits of fiat and crypto assets for custody, <a href="https://support.stably.io/en/articles/8039846-prime-trust-halting-deposit-withdrawal" target="_blank" rel="follow">according to Stably</a>,
which is a company that provides stablecoins and fiat-to-crypto on-ramps. The
move is in line with an order by the Nevada Financial Institution Division. </p><p>Cryptocurrency exchange
Coinmetro also made a similar move, saying it “is currently unable to process
new USD transactions."</p><blockquote><p lang="en" dir="ltr">⚠️ Important announcement: unexpected disruption in USD transactions. We regret to inform you that our partner for USD payments PrimeTrust has temporarily suspended USD deposits and withdrawals. This means that Coinmetro is currently unable to process new USD transactions.While…</p>— Coinmetro (@CoinMetro) <a href="https://twitter.com/CoinMetro/status/1671859408031055875?ref_src=twsrc%5Etfw">June 22, 2023</a></blockquote><p>New exchange on TradingView; HKEX in New York; <a href="https://www.financemagnates.com/forex/news-nuggets-22-june-new-exchange-on-tradingview-hkex-in-new-york/" target="_blank" rel="follow">read today's news nuggets</a>.</p>

This article was written by Solomon Oladipupo at www.financemagnates.com.