The digital asset custodian BitGo has initiated legal action against the cryptocurrency investment firm Galaxy Digital. This action is in accordance with BitGo’s previously stated intention to pursue more than one hundred million dollars in damages following Galaxy’s decision to abandon its plan to acquire BitGo.
According to a tweet sent out by the firm this morning, BitGo filed the lawsuit late on Monday. The company had previously stated in August that it would do exactly that, shortly after Galaxy Digital terminated the deal citing “BitGo’s failure to deliver, by July 31, 2022, audited financial statements for 2021 that comply with the requirements of our agreement.” This was after the company had previously stated in August that it would do exactly that.
According to a tweet published by the company today, “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.” The lawsuit was prompted by Galaxy’s improper repudiation and intentional breach of its merger agreement with BitGo.
Attorney Brian Timmons of the firm Quinn Emanuel said that the case was sealed to provide the business the opportunity to redact any potentially sensitive material in the coming days. BitGo stated that it filed the action in Delaware’s Chancery Court. According to the announcement made by the corporation, it will likely be accessible to users not long after the close of business on Thursday.
Galaxy Digital has revealed that it intends to complete the acquisition of BitGo in May 2021 in a transaction valued at $1.2 billion and comprised of cash and shares. However, more than a year later, the transaction still hadn’t been finalized, which raised suspicions in advance of Galaxy’s statement in the middle of August that it would be canceling the arrangement.
BitGo said that Galaxy Digital was obligated to pay a termination fee of $100 million, while Galaxy Digital stated that it would not be responsible for any fees associated with withdrawing from the arrangement. Galaxy Digital, which was established by billionaire CEO Mike Novogratz, recently reported a loss of $554 million for the second quarter of 2022. This news came one week before the company stated that it would no longer be acquiring BitGo.
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