BitGo cancels Prime Trust acquisition, uncertainty returns.
BitGo had planned to acquire Prime Trust, a well-known custody firm. However, BitGo recently announced on Twitter that they have cancelled the acquisition. This news came as a surprise, as the initial announcement had generated a lot of excitement within the industry. The combination of these two major custodians was expected to have a significant impact on the industry landscape.
BitGo had previously stated that they intended to provide business continuity, long-term stability and secure services to Prime Trust clients. Prime Trust was enthusiastic about the partnership and believed that the combined company would revolutionize the future of custody services. Jor Law, Prime Trust’s Interim CEO and President, stated that “No other company will have the breadth of product and services nor depth of experience that this combined company would have.”
Despite considerable efforts and discussions, BitGo made the “hard decision” to terminate the acquisition. The company did not provide specific reasons for this change of course, but emphasized its commitment to delivering trust in digital assets. The termination of the deal raises questions about the future trajectory of Prime Trust, as there were rumors about the firm’s liquidity prior to the acquisition announcement.
The original acquisition decision came at a time when Bitcoin-only exchanges Strike and Swan both announced their departure from custody services provided by Prime Trust. Strike switched to utilizing its own custody services, while Swan transitioned to BitGo and Fortress Trust, which was founded by Scott Purcell, the former founder of Prime Trust.
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Although the termination of the acquisition raises speculation about the financial health of Prime Trust, the recent announcement did not address or confirm these rumors. The industry will now eagerly await further details and clarifications from both BitGo and Prime Trust regarding their future plans and strategies.