- Prime Trust owes its customers about $85 million in fiat
- The company owes another $69.5 million in cryptocurrency
Nevada Division of Financial Institutions filed a lawsuit to transfer and freeze the enterprises of the cryptocurrency custodian Prime Trust. The regulator claims that the company did not have the funds to cover customer deposits and also lost access to some wallets.
Prime Trust owes approximately $85 million in fiat to its clients, with just $3 million on hand, according to a published takeover petition. The company has $69.5 million in crypto debt with $68.6 on its balance sheet. million. The statement says that Prime Trust is operating with a net worth deficit of $12 million.
According to the information provided in the petition, from December 2021 to March 2022, Prime Trust purchased an additional digital currency using client funds in order to ensure the withdrawal of funds from inaccessible legacy wallets. The company tried to restore access to Legacy Wallets, but at the time of the petition, this was not possible.
In addition, the lawsuit includes a request for the appointment of a trustee who will take over the day-to-day operations of the company and analyze its financial condition in detail in order to determine the best option for protecting Prime customers. This option may include the rehabilitation of the company and its return to private management, or liquidation.
The filing also requires the court to prohibit Prime Trust, as well as its officers, directors, shareholders and others, from disposing of any of the company’s assets or entering into any transactions.