Galaxy Digital and BitGo Return to Court Over Collapsed $1.2B Crypto Deal

Nearly four years after Galaxy Digital revealed plans to purchase BitGo, the two crypto companies are now locked in a courtroom fight over the collapse of the once high-profile merger.

According to reports from this week’s proceedings, BitGo is pushing for at least $100 million in damages after Galaxy abandoned the proposed acquisition, which had previously valued BitGo at roughly $1.2 billion. The deal officially unraveled in August 2022 when Galaxy withdrew from the agreement.

BitGo argues that Galaxy failed to make sufficient efforts to finalize the transaction and allegedly did not disclose ongoing investigations by U.S. regulators that may have affected the company’s ability to complete the acquisition.

Galaxy, led by billionaire investor Michael Novogratz, has maintained that its decision to terminate the merger stemmed from BitGo’s inability to provide audited 2021 financial statements within the timeline outlined in the agreement. At the time, Galaxy stated that the conditions required to trigger a breakup fee had not been met.

Despite that position, BitGo has continued pursuing compensation, insisting the crypto financial firm owes either the originally discussed $100 million termination payment or additional damages tied to the failed deal.

The acquisition was first announced in May 2021 during a period of rapid expansion across the digital asset industry. Under the proposed arrangement, BitGo CEO Mike Belshe was expected to take on a leadership role at Galaxy as deputy CEO while also joining the company’s board.