According to multiple rumors and reports, Prime Trust, a top infrastructure provider in the crypto sector, could be on the brink of failure or acquisition.
A recent Tweet claims to have knowledge that Prime Trust is close to insolvency.
So this is in regards to #PrimeTrust
They need 25million by Monday or they're insolvent.
I think #CZ can send that over through @justinsuntron TUSD pretty easily pic.twitter.com/nRLuhW7sMe
— BareNakedCrypto 🫐, (@BullNakedCrypto) June 8, 2023
At the same time, a report by CoinDesk indicates that Bitgo has reached an agreement in principle to acquire the firm. Bitgo, founded in 2012, also provides custody via Bitgo Trust Company, claiming to process about 20% of all global Bitcoin transactions.
WSJ.com has confirmed a sale is in the works sharing that Prime Trust had been attempting to raise “tens of millions” of dollars in recent weeks.
Prime Trust was once the star of the traditional online capital formation world, providing services to just about all investment crowdfunding platforms. When the digital asset sector emerged, growing rapidly, Prime Trust saw an opportunity to juice its growth and entered the hot crypto market, providing needed regulated services.
Founded by serial entrepreneur Scott Purcell, the company appeared to be on solid footing when he left the firm to start another venture. A funding round of $100 million in 2022 seemed to be a sufficient war chest to fuel the company that provided custody services through a challenging market. At the same time, Prime Trust announced the cessation of Fund America, which served online marketplaces in the traditional securities sector.
At the end of 2022, an unexpected transition took place as then-CEO Tom Pageler was removed by the Board of Directors, and well-known Fintech insider Jor Law stepped in to manage the firm that was entering a challenging environment for crypto as failures and regulatory scrutiny grew.
As fast as Prime Trust became a crowdfunding success, the company may now be the next casualty in the shattering of the US crypto industry by ongoing enforcement actions and a lack of rules structured for the digital asset sector.
CI has reached out to Prime Trust for a comment.
