Prime Trust lays off two-thirds of staff as regulatory woes deepen
Fintech and cryptocurrency infrastructure provider Prime Trust is reportedly poised to lay off more than two thirds of its employees, two people familiar with the situation told CoinDesk.
The cuts primarily impact the majority of Prime Trust’s departments, though it was not immediately clear how many people were affected.
The layoffs follow a string of compliance and operational problems for the company. Most recently, a Nevada court appointed a receiver for Prime Trust, which has an opportunity to present its case against the petition at a hearing scheduled for August 22. A month earlier, BitGo terminated its preliminary agreement to acquire the rival cryptocurrency custodian.
BitGo said the decision was made after extensive efforts and negotiations to find a viable path forward with Prime Trust.
Prime Trust counts some of the world’s largest crypto brands such as Swan, Abra, Dapper Labs and Binance US as clients. It also offers services to other crypto exchanges, NFT creators, digital wallets, OTC desks, RIAs, broker-dealers, banks, and neobanks.
The Las Vegas-based firm offers a portfolio of APIs and plug-and-play widgets as it seeks to be the one-stop shop for financial infrastructure of Fintechs including firms in the cryptocurrency sector. Prime Trust is already famous in the blockchain space thanks to its back-office solutions. The SEC-regulated company began its Bitcoin storage service in 2020, and then added support for Ethereum and ERC-20 tokens.
Prime Trust also serves as a custodian and trustee for personal and corporate trusts, as well as for crowdfunding platforms. The firm claims to have crossed $100 million in annual revenue last year, as well as 250 million API calls per month from its B2B customers.
The cancelled agreement, made public on June 8, would have granted BitGo the control of Prime Trust’s payment rails and cryptocurrency Individual Retirement Account (IRA) fund. This deal was also expected to expand BitGo’s wealth management offerings, providing a broader range of services to its customers.
At the time, BitGo said the transaction not only brings Prime Trust’s regulated business in Nevada into its network of trust companies, but it will also leverage its fintech API infrastructure and exchange network to strengthen BitGo’s Wallet Services (BWS) and Go Network. This collaboration was supposed to enhance BitGo’s capabilities in custody, liquidity, settlement, and compliance by mapping them over a 1:1 ratio.
