Regulatory Orders Says Prime Trust Has 'Shortfall of Customer Funds'

<p>Prime Trust is the latest <a href="https://www.financemagnates.com/cryptocurrency/news/nasdaq-to-launch-crypto-custody-services-for-institutions/">crypto custody platform</a> to be in trouble, as it received a cease-and-desist order from the Nevada Department of Business and Industry for a "shortfall in customer funds" and not being able to handle customers' withdrawal requests.
</p><p>Troubled Prime Trust
</p><p>The regulatory order was published publicly on Thursday, hours after BitGo, another digital asset custody provider, terminated its deal to <a href="https://www.financemagnates.com/cryptocurrency/crypto-custody-provider-bitgo-ditches-plan-to-acquire-rival-prime-trust/">acquire Prime Trust</a>. Although, a spokesperson from the Nevada regulator confirmed to the media that the order was issued on June 21.
</p><p>According to the Nevada regulator's Financial Institutions Division (FID), Prime Trust's "overall financial condition … has considerably deteriorated to a critically deficient level," and thus, the company has been ordered to cease all activities. The regulator further highlighted that the crypto custodian might be on the brink of liquidation.
</p><p>"On or about June 21, 2023, Respondent was unable to honor customer withdrawals due to a shortfall of customer funds caused by a significant liability on the Respondent's balance sheet owed to customers," the regulatory order stated. "Additionally, Respondent failed to safeguard assets under its custody and is unable to meet all customer withdrawals."</p><blockquote><p lang="en" dir="ltr">TrueUSD printed a billion stablecoins out of thin air, just a few days before the suspension of Prime Trusts services.In March of 2017, Tether also lost banking access and suspiciously started printing billions of Tethers that could not be redeemed.TrueUSD is now doing the… <a href="https://t.co/BZoLn7Z8LV">pic.twitter.com/BZoLn7Z8LV</a></p>— Bitfinex’ed