Bitgo has decided to terminate its preliminary agreement to acquire Prime Trust.
Earlier this month, rumors circulated about troubles at Prime Trust, with Bitgo emerging as a white knight to acquire the firm. BitGo had signed a term sheet to acquire the equity of Prime Core Technologies, the parent company of Prime Trust. Both companies provide certain financial services, such as custody for digital asset firms. Prime Trust is one of the biggest names in Fintech for providing back end services.
In a Tweet, BitGo announced its decision.
At the same time, reports have circulated that Prime Trust is halting all deposits and withdrawals.
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
CI received a note from HAYVN, a digital asset firm providing trading, asset management, custody, and more for clients globally.
PrimeTrust has suspended all deposits of fiat and digital assets. #TrueUSD (#TUSD) is not affected by this situation. We have no exposure to Prime Trust and maintain multiple USD rails for minting and redemption. Rest assured, all your funds are safe with TUSD.
— TrueUSD (@tusdio) June 22, 2023
HAYVN CEO Christopher Flinos stated:
“The recent news of Prime Trust halting all deposits of fiat and digital assets yet again highlights the importance of transforming the digital assets industry to ensure its sustainability and credibility. HAYVN has zero exposure to Prime Trust and multiple USD rails available. The safety and security of our client’s digital and financial assets continue to remain at the forefront of all that we do at HAYVN. The digital assets industry needs to collaborate more with regulators and governments in order to ensure that our services are fit for use and able to withstand market conditions in any economic climate. We need to be more accountable to the customers that we serve because without them our industry would not exist.”
The chatter on crypto Twitter included a statement that Nevada regulators were reviewing the company.
🚨🚨SCOOP: PRIME TRUST RECEIVED CEASE AND DESIST ORDER FROM NEVADA STATE REGULATORS.
PRIME IS HALTING ALL WITHDRAWALS OF FIAT AND CRYPTO EFFECTIVE IMMEDIATELY. https://t.co/0rLzOGZXlR pic.twitter.com/gsRYevAmJM
— DIRTY BUBBLE MEDIA: GOOD LUCK, GOOD BYE. (@MikeBurgersburg) June 22, 2023
Previously, Prime Trust had been affiliated with a story about Banq, which filed for bankruptcy. Some news sites claimed it was a subsidiary of Prime Trust, but, in fact, Prime Trust only controlled a minority stake of 3% in the firm.
Prime Trust has yet to issue a public statement on the decision by BitGo to forgo the acquisition and claims of a regulatory investigation.