BitGo Won't Buy Back The Troubled Crypto Platform Prime Trust

Key Points:

BitGo said on Thursday that it is canceling its planned purchase of crypto custodian Prime Trust.
Recently, BitGo announced that it had signed a non-binding term agreement to buy 100% of Prime Core Technologies’ shares.
Prime Trust is now embroiled in a legal battle with the SEC and Binance.

BitGo stated on Thursday that it is canceling its planned purchase of crypto custodian Prime Trust, only two weeks after announcing the agreement.

BitGo Won't Buy Back the Troubled Crypto Platform Prime Trust

BitGo Holdings previously announced that it had signed a non-binding term sheet to buy 100% of Prime Core Technologies, the parent firm of crypto custodian Prime Trust.

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.
— BitGo (@BitGo) June 22, 2023

BitGo said that the transaction would provide Prime Trust customers with business continuity and long-term stability, as the Nevada Trust Company would join BitGo’s network of regulated trust firms in South Dakota, New York, Germany, and Switzerland.

Prime Trust, situated in Las Vegas, Nevada, was founded in 2016 and provides numerous developer tools and APIs to crypto enterprises, including custody, payment rails, compliance, liquidity, and settlement. Prime Trust secured $107 million in Series B fundraising last year from investors such as Kraken Ventures, FIS Impact Ventures, and Fin Capital.

Prime Trust started providing services to cryptocurrency firms in 2018, and the company claims to have serviced almost 700 fintech and cryptocurrency customers. Nevertheless, it has lately lost numerous customers, including the Binance.US exchange, which was previously sued by the US Securities and Exchange Commission for allegedly breaching the country’s securities laws, among other allegations.

The SEC complaint references a “Trust Company B,” which has sparked social media speculation that it is Prime Trust.

Prime Trust is in a lot of trouble right now. Banq, a subsidiary of this company, has filed for bankruptcy in the US District Court for the District of Nevada. TrueUSD has officially confirmed that it will no longer be minting TUSD via Prime Trust for the time being.

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