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Crypto Custodian BitGo to Acquire Struggling Rival Prime Trust

source-logo  thecoinrepublic.com 09 June 2023 13:38, UTC

BitGo is a crypto custodian based in the United States, California, and Palo Alto; it has numerous subsidiaries, including Lumina, Hedgly Capital Advisors, Harbor Platform, Lumina Technology, and Portum Capital.

On June 8, 2023, the crypto custodian was revealed that it had signed a term sheet to acquire the equity of Prime Core Technologies, the parent company of Prime Trust. It is important to note that both companies provide custody services to the clients.

The rules in the agreement are yet to be revealed, but it is important to note that if the deal goes through, BitGo will acquire Prime trust payment rails and cryptocurrency IRA Funds and boost its wealth management offerings.

As per BitGo’s official statement, “The following acquisition will make BitGo the foremost global asset company to provide a full suite of solutions for institutions and financial service providers.”

Prime Trust’s acquisition comes after the United States Securities and Exchange Commission (SEC) changed the rules and made it harder for crypto-focused companies to act as custodians of its users’ funds.

Prime Trust has been struggling for some time. In early January, it laid off one-third of the total workforce. BitGo was among the companies which were likely to get acquired by Galaxy Digital for the sum of $1.2 Billion, but due to some uncertainty, the deal was canceled.

BitGo filed a complaint against Galaxy Digital for canceling the acquisition. The acquisition seeker of BitGo canceled the deal amid its poor performance.

Significant Investments and Acquisitions of BitGo

Crunchbase data reveals that BitGo has acquired three companies as of now, and the acquisition of Prime Trust will be its fourth acquisition. Between October 2019 and April 2020, BitGo acquired Lumina, Harbor, and Hedge for an undisclosed amount.

The crypto custodian raised $69.5 Million in six funding rounds and is majorly funded by Pantera Capital, Galaxy Digital, Craft Ventures, Digital Currency Group, Red Point, GS Growth, and Bill Lee.

Bitgo chief executive officer, Mike Belshe, joined the DeFi researcher Chris Blec’s Twitter Spaces on December 14. Belshe said the trading firm tried to redeem its 3,000 Wrapped Bitcoin (wBTC) sometime earlier than FTX filing for bankruptcy.

On November 25, according to an analysis by Arkham Intelligence, Alameda took $204 Million from FTX and sent it to eight separate addresses. The ongoing hunt down of the U.S. SEC has stirred the digital asset market, and a steep decline is seen in the global crypto market.

After monitoring the market closely, it was observed that most centralized exchanges had mirrored a decline in 24-hour trading volume. In the last seven days of the trading session, Cardano fell over 15%, followed by Monera, which dropped 2%, and Filecoin slipped more than 17%.

Bitcoin, the most valued crypto, slipped 1.45% in weekly trading sessions and was trading below $26k when SEC filed a lawsuit against Coinbase and another leading cryptocurrency exchange.

The 24-hour trading volume of Bitcoin was $12 Billion earlier. Tether recently replaced Bitcoin as the most traded cryptocurrency with a trading volume of $18 billion (press time).


The views and opinions stated by the author, or any people named in this article, are for informational ideas only and do not establish financial, investment, or other advice. Investing in or trading crypto assets comes with a risk of financial loss.