Fintech and cryptocurrency infrastructure provider Prime Trust agreed to turn over roughly $17 million worth of cryptocurrency to crypto lending platform Celsius.
Those assets will be sent to a designated Celsius wallet until the court figures out about how the money should be distributed.
In a filing with the U.S. Bankruptcy Court in the Southern District of New York, Celsius’ legal team said Prime Trust had held $119 million of its assets. Then in August, the company brought a complaint alleging that the Las Vegas-based firm did not return the remaining balance when the contract was dissolved in June 2021.
According to Celsius, the assets are made up of 398 BTC, 196,268 CEL tokens, 3,740 ETH and 2.2 million USDC. Prime Trust acted as crypto custodian for Celsius’ New York- and Washington-based users from 2020 through mid-2021, returning $119 million of Celsius’ assets at the time the contract was ended. At the time, Prime Trust removed Celsius from its platform, citing a variety of “business factors.”
Earlier in June, Celsius abruptly announced that it was pausing all withdrawals, swaps and transfers between users’ accounts because of extreme market volatility. The crypto lending and borrowing platform was apparently first looking for possible financing options from investors but is also exploring other strategic alternatives.
Prime Trust 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. The company is already famous at 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 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.
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.
Prime Trust, however, is not the only company providing infrastructure and operational cryptocurrency custodianship for the wider investment management industry. Leading cryptocurrency exchange Coinbase, Japanese financial holdings company Nomura and most recently SIX Group, the owner of SIX Swiss Exchange, have all launched similar services for institutional investors.
