Galaxy Digital Pulls Out of BitGo Acquisition

Galaxy Digital Pulls Out of BitGo Acquisition

| Updated
by Ibukun Ogundare · 3 min read
Galaxy Digital Pulls Out of BitGo Acquisition
Photo: Unsplash

Galaxy Digital said it would move on with its reorganization plans.

As the new week begins on August 15th, Galaxy Digital released a press release saying it is terminating its acquisition of digital asset trust company BitGo. The crypto custodian announced in May 2021 that Galaxy Digital had agreed to the purchase. The acquisition was going to add more than 400 global net new clients to Galaxy Digital. Also, the company was going to welcome new businesses, including a regulated client custody solution from BitGo Trust Companies in different locations. The locations include Germany, South Dakota, Switzerland, and New York. The agreement, which was to close in Q4 2021, was approved by the board of directors at BitGo and Galaxy Digital.

Under the deal, Galaxy Digital was to purchase BitGo for $1.2 billion. CEO Mike Novogratz had boasted that Galaxy Digital was able to add a feather to its cap.

“The acquisition of BitGo established Galaxy Digital as a one-stop-shop for institutions and significantly accelerates our mission to institutionalize digital asset ecosystems and blockchain technology. The power of the technology, solution, and people we will have as a result of this acquisition will unlock unique value for our clients and drive long-term growth for our combined business. We are excited to welcome Mike Belshe and the talented BitGo team to Galaxy.”

Galaxy Digital Terminates BitGo Acquisition

However, Galaxy Digital is pulling out of the deal, claiming BitGo is not complying with the requirements. The company said the digital asset trust company failed to deliver the audited financial statement for 2021 by July 31st. Apparently, BitGo was to present the financial statement, per the agreement. Galaxy Digital noted that there is no termination fee under the contract. CEO Mike Novogratz said in the press release:

“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 US and providing our clients with a prime solution that truly makes Galaxy a one-stop shop for institutions.”

Further into the official statement, Galaxy Digital said it would move on with its reorganization plans. The company is also working on becoming a Delaware-based company and going public on the Nasdaq. Galaxy Digital trades on the Toronto Stock Exchange (TSE) as GLXY. Its domestication move is to list its Common A shares in the US. The proposed listing depends on the stock exchange’s approval and the SEC review’s outcome.

Galaxy concluded the press release by emphasizing its focus on executing its business objectives. It also said it would continue to work on driving long-term performance for investors.

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