Galaxy Digital Cancels $1.2B BitGo Acquisition Plans
- Mike Novogratz’s crypto investment company said it was terminating the acquisition deal as BitGo failed to provide audited financial statements for 2021.
- Galaxy Digital is still looking to go public through a NASDAQ listing, and is currently awaiting approval from the SEC to reorganize as a Delaware-based company.
Michael Novogratz, CEO of Galaxy Digital Adam Jeffery/CNBC
Crypto investment firm Galaxy Digital has terminated its plans to acquire digital asset custodian BitGo due to a breach of contract, the company said in a press release on 15 August.
According to the announcement, BitGo failed to provide Galaxy Digital with audited financial statements for 2021, which it should have done by the end of July 2022, and as such the investment firm has decided to terminate the acquisition deal. Galaxy Digital also noted it will not be paying any termination fees as its decision was in line with the acquisition agreement, which BitGo broke. The founder and CEO of Galaxy Digital, Michael Novogratz, said in a statement:
“Galaxy remains positioned for success and to take advantage of strategic opportunities to grow in a sustainable manner. We are committed to continuing our process to list in the U.S. and providing our clients with a prime solution that truly makes Galaxy a one-stop shop for institutions.”
The crypto investment firm revealed its intentions to acquire BitGo more than a year ago, as part of its effort to go public in the United States, with the deal being valued at around $1.2 billion at the time. The terms of the deal were renegotiated back in March, giving BitGo’s investors a larger stake in the new company, with Galaxy Digital expecting to finalize the acquisition by the end of 2022.
Galaxy Digital is currently awaiting the U.S. Securities and Exchange Commission’s approval to reorganize as a Delaware-based company, and go public through a NASDAQ listing. In today’s press release, the company also noted it remains focused on launching its newest product, Galaxy One Prime, which will provide institutional investors services such as trading, lending, and derivatives.
- One of the largest South Korean commercial banks, KEB Hana Bank, partnered with crypto custodian BitGo in order to set up a new crypto custody venture in the country.
- The new venture, which will use BitGo’s crypto security expertise and Hana’s experience in financial services and compliance, is expected to launch in the second half of 2024.
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- The bankrupt crypto lender has agreed on a settlement with its Series B holders on how to distribute the $25 million from the sale of self-custody platform GK8.
- The majority of funds, $24 million, will be allocated for legal expenses, while the remaining $1 million will be distributed between the Series B holders.
- The new funding will help Chaos Labs build out and expand its suit of risk and security products that can help DeFi protocols.
- The seed funding round was co-led by PayPal and Galaxy Digital, but also saw participation from including Coinbase Ventures, Polygon, Avalanche, OpenSea, Uniswap, and others.