Prime Trust was founded many years ago at the beginning of online capital formation. At one point, it was one of the most important and successful firms in the securities crowdfunding marketplace providing services for just about all the platforms. As digital assets became a hot sector, Prime Trust was there to provide custody and more for emerging firms.
Founder and former CEO Scott Purcell was a regular suspect at the various crowdfunding and Fintech events. In a land of many companies losing money, Prime Trust was one of the few generating a positive result.
In 2021, Purcell exited Prime Trust to launch a new firm, Fortress. After appointing a new CEO, Purcell’s quiet departure was accompanied by rumors that he no longer held any equity in the company he founded.
Today, rumblings indicate that Prime Trust is under regulatory scrutiny by Nevada state officials, causing BitGo to terminate the acquisition of Prime Trust.
Starting with a statement that Fortress has no exposure to Prime Trust, Purcell says Prime Trust is in receivership with the Banking Commissioner (FID), having ceased all deposits and withdrawals.
Purcell states:
While George, Kevin, Amanda, Bruce, and I did used to work there 2 1/2 years ago, we left when the company was profitable and doing well. Ancient history. What the subsequent management team did with the company is incredibly sad to see, heart-wrenching. Prime Trust raised over $180M since I exited as CEO, and how they could screw that up is, to me, beyond imagination. But it was after we left.”
Purcell notes that it is business as usual for other digital asset custodians, alluding to his opinion this is not a systemic event.
Purcell has previously distanced himself from the Banq failure, which was spun out from Prime Trust and remained a customer, with Prime Trust holding a small stake in the firm. Purcell said the Banq bankruptcy filing attempted to denigrate him describing any claims as pure fiction.
As for Prime Trust, it has yet to release a statement explaining its status,f leaving Twitter to define the moment.
