Fintech Prime Trust, a company that manages cryptocurrency, has filed for Chapter 11 bankruptcy in the US.
Prime Trust has selected former Bank of Nevada president John Guedry as the receiver. He will direct the company’s activities throughout the bankruptcy process along with other representatives.
Nevada’s regulatory authorities determined that the business was bankrupt and unable to cooperate with its clients in late June. Receivers were appointed to take over.
BitGo signed a LOI hoping to buy the business but ultimately decided against doing so. According to the State of Nevada Department of Business and Industry, the corporation had negative stock worth approximately $12 million.
Its financial situation has gotten worse since June. Regulators further stated that as of December 2021, Prime Trust has been using consumer funds to pay withdrawals. The company owed $82 million to its present clients in the form of overdue deposits and fiat money from those clients.
According to Prime Trust, the bankruptcy procedure would let the business consider several options, such as selling assets. The business is being managed under the bankruptcy court’s jurisdiction while in the “state of debtors-in-possession”. Scott Purcell started Prime Trust in 2016 in Nevada. The business offers an infrastructure for digital assets and finance.
