{"id":29395,"date":"2026-05-22T07:12:23","date_gmt":"2026-05-22T07:12:23","guid":{"rendered":"https:\/\/bitunikey.com\/news\/galaxy-and-bitgo-face-off-over-failed-1-2b-deal\/"},"modified":"2026-05-22T07:12:34","modified_gmt":"2026-05-22T07:12:34","slug":"galaxy-and-bitgo-face-off-over-failed-1-2b-deal","status":"publish","type":"post","link":"https:\/\/bitunikey.com\/news\/galaxy-and-bitgo-face-off-over-failed-1-2b-deal\/","title":{"rendered":"Galaxy and BitGo face off over failed $1.2B deal"},"content":{"rendered":"<p><\/p>\n<div class=\"post-detail__content blocks\">\n<p><strong>Galaxy Digital founder Mike Novogratz has appeared in court as the company fights BitGo\u2019s $100 million claim tied to a failed $1.2 billion merger.<\/strong><\/p>\n<div id=\"cn-block-summary-block_6f19b5e53292b2f048b4551c1bd2dbef\" class=\"cn-block-summary\">\n<div class=\"cn-block-summary__nav tabs\">\n        <span class=\"tabs__item is-selected\">Summary<\/span>\n    <\/div>\n<div class=\"cn-block-summary__content\">\n<ul class=\"wp-block-list\">\n<li>Mike Novogratz testified in Delaware court over Galaxy\u2019s failed $1.2 billion BitGo acquisition.<\/li>\n<li>BitGo is seeking a $100 million termination fee after Galaxy called off the merger in 2022.<\/li>\n<li>The dispute centers on financial statements, SEC accounting rules, and whether Galaxy validly ended the deal.<\/li>\n<\/ul><\/div>\n<\/div>\n<p><!-- .cn-block-summary --><\/p>\n<p>Novogratz appeared in Delaware Chancery Court this week in the long-running dispute between Galaxy Digital and BitGo. BitGo is asking the court to make Galaxy pay at least $100 million after the crypto investment firm walked away from the acquisition.<\/p>\n<p>The companies agreed to the deal in 2021, when crypto valuations were still high. Galaxy later ended the merger in August 2022, after the Terra collapse and a wider market downturn. Galaxy said BitGo failed to deliver required audited financial statements on time. BitGo said Galaxy wrongly abandoned the deal.<\/p>\n<p>    <!-- .cn-block-related-link --><\/p>\n<h2 class=\"wp-block-heading\"><strong>SEC accounting rules sit at center of case<\/strong><\/h2>\n<p>According to Bloomberg\u2019s report, Novogratz <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/www.bloomberg.com\/news\/articles\/2026-05-21\/billionaire-novogratz-fights-100-million-fee-on-dud-crypto-deal\" target=\"_blank\" rel=\"nofollow\">testified<\/a> that he was \u201cpushing to get this deal done,\u201d but said the SEC made approval difficult under then-Chair Gary Gensler. He also said Galaxy itself was not the subject of a government probe.<\/p>\n<figure class=\"wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter\">\n<div class=\"wp-block-embed__wrapper\">\n<blockquote class=\"twitter-tweet\" data-width=\"550\" data-dnt=\"true\">\n<p lang=\"en\" dir=\"ltr\">BitGo is demanding that Galaxy pay it at least $100 million for pulling out of the $1.2 billion transaction \u2014 a deal that was the biggest ever in the crypto industry when it was proposed in 2021. <a rel=\"nofollow\" target=\"_blank\" rel=\"nofollow\" href=\"https:\/\/t.co\/VLs70WiiP1\">https:\/\/t.co\/VLs70WiiP1<\/a><\/p>\n<p>\u2014 Bloomberg (@business) <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/twitter.com\/business\/status\/2057497271286014408?ref_src=twsrc%5Etfw\" target=\"_blank\" rel=\"nofollow\">May 21, 2026<\/a><\/p><\/blockquote>\n<\/div>\n<\/figure>\n<p>The accounting issue traces back to SEC Staff Accounting Bulletin 121. The Delaware Supreme Court <a rel=\"nofollow\" target=\"_blank\" href=\"https:\/\/courts.delaware.gov\/Opinions\/Download.aspx?id=364290\" target=\"_blank\" rel=\"nofollow\">said<\/a> SAB 121 became effective shortly before BitGo\u2019s financial statement deadline and gave guidance for public companies that safeguard digital assets.\u00a0<\/p>\n<p>The court also noted that if BitGo failed to submit compliant statements by July 31, 2022, Galaxy could terminate the agreement without paying the reverse fee.<\/p>\n<h2 class=\"wp-block-heading\"><strong>BitGo says Galaxy damaged its reputation<\/strong><\/h2>\n<p>BitGo CEO Mike Belshe testified that the failed deal hurt the company. He said \u201cThis was incredibly damaging,\u201d according to the report, while arguing that BitGo had provided the needed information.<\/p>\n<p>BitGo\u2019s side says Galaxy\u2019s public reason for ending the merger suggested that BitGo could not pass an audit. Galaxy disputes that view and says the contract allowed termination without the $100 million fee because the financial statements did not meet the required terms.<\/p>\n<h2 class=\"wp-block-heading\"><strong>Court fight comes as both firms expand<\/strong><\/h2>\n<p>The case returns at a busy time for both companies. BitGo became a public company in January and later reported $3.77 billion in first-quarter revenue, up 112.6% from a year earlier. However, its net loss widened to $60.7 million as Bitcoin treasury marks and IPO costs weighed on results.<\/p>\n<p>Galaxy has also been expanding its regulated U.S. footprint. A recent market update said GalaxyOne Prime NY received both a BitLicense and Money Transmission License from New York regulators on May 18, allowing it to offer trading and custody services to institutions in the state.<\/p>\n<p>The trial is expected to end this week. The judge will decide whether Galaxy must pay the $100 million fee or whether the company had the right to terminate the deal without payment.<\/p>\n<p>    <!-- .cn-block-related-link --><\/p><\/div>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Galaxy Digital founder Mike Novogratz has appeared in court as the company fights BitGo\u2019s $100 million claim tied to a failed $1.2 billion merger. Summary Mike Novogratz testified in Delaware&hellip;<\/p>\n","protected":false},"author":1,"featured_media":29396,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[],"class_list":["post-29395","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-cryptocurrency"],"_links":{"self":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/29395","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/comments?post=29395"}],"version-history":[{"count":1,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/29395\/revisions"}],"predecessor-version":[{"id":29397,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/posts\/29395\/revisions\/29397"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/media\/29396"}],"wp:attachment":[{"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/media?parent=29395"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/categories?post=29395"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/bitunikey.com\/news\/wp-json\/wp\/v2\/tags?post=29395"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}