A Delaware judge has dismissed the lawsuit filed by crypto custodian BitGo against Galaxy Digital over the cancellation of their $1.2 billion acquisition deal.
The Case Highlights the Complexities and Legal Disputes That Can Arise in the Crypto Industry
A Delaware judge has dismissed the lawsuit filed by crypto custodian BitGo against Galaxy Digital over the cancellation of their $1.2 billion acquisition deal. The judge ruled in favor of Galaxy, stating that the company had a valid reason to terminate the agreement due to BitGo providing "non-compliant" financial documents. BitGo expressed its intention to appeal the decision, maintaining that Galaxy wrongfully terminated the agreement. The initial deal was agreed upon in May 2021, with Galaxy aiming to offer prime brokerage services to institutional investors. However, amid the bear market, Galaxy called off the merger in August 2022, citing BitGo's failure to provide audited financial statements. BitGo subsequently sued for $100 million in damages, alleging that Galaxy's justification was unfounded and suggesting financial difficulties as the true reason for the cancellation.
The court's decision marks a setback for BitGo, as it sought to hold Galaxy accountable for the canceled acquisition. The case highlights the complexities and legal disputes that can arise in the crypto industry, particularly in the context of high-value transactions and market volatility. BitGo's decision to appeal indicates its determination to challenge the ruling and seek a favorable outcome. Meanwhile, Galaxy Digital, led by Mike Novogratz, can now move forward without the acquisition, focusing on its other ventures in the crypto space.
