Galaxy Digital Sued by BitGo Over Termination of Acquisition Deal

Galaxy Digital Sued by BitGo Over Termination of Acquisition Deal
  • BitGo said it had filed the complaint in Delaware’s Chancery Court.
  • BitGo said that Galaxy Digital was obligated to pay a $100 million termination fee.

BitGo, a digital asset custodian, has launched a lawsuit against Galaxy Digital, a cryptocurrency investment business, seeking more than $100 million in damages after Galaxy’s decision to back out of an acquisition deal.

BitGo tweeted early this morning that it had filed the lawsuit late Monday. When Galaxy Digital terminated the agreement in July, the company cited “BitGo’s failure to deliver, by July 31, 2022, audited financial statements for 2021 that comply with the requirements of our agreement.” The company had earlier claimed in August that it will do exactly that.

The firm tweeted:

“Late yesterday, BitGo filed a lawsuit against Galaxy Digital seeking damages of more than $100 million arising from Galaxy’s improper repudiation and intentional breach of its merger agreement with BitGo.”

Crypto Winter Effect?

BitGo said it had filed the complaint in Delaware’s Chancery Court, and attorney Brian Timmons of the firm Quinn Emanuel claimed the petition was sealed to allow the business time to redact any potentially sensitive material. It will be accessible on Thursday evening, the firm stated.

In May of 2021, Galaxy Digital announced that they would purchase BitGo for $1.2 billion in cash and shares. Nonetheless, after more than a year, the agreement still hadn’t been finalized, raising eyebrows ahead of Galaxy’s statement in mid-August that it would be canceling the arrangement.

BitGo said that Galaxy Digital was obligated to pay a $100 million termination fee, while Galaxy Digital insisted that it would not be penalized in any way for terminating the agreement. The $554 million loss made by Galaxy Digital in Q2 2022 was revealed a week before the company canceled the BitGo purchase. Galaxy Digital was founded by billionaire CEO Mike Novogratz.

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