Mike Novogratz , the founder of Galaxy Digital, testified in the Delaware Chancery Court that the U.S. Securities and Exchange Commission (SEC) created serious obstacles that prevented the company from proceeding with its $1.2 billion merger with BitGo in 2021 – the largest M&A deal in crypto history at the time.
Galaxy Digital canceled the deal in August 2022, after which BitGo demanded that Galaxy pay a $100 million termination fee. This fee had been agreed upon beforehand as a safeguard in case the deal fell through.
The two sides held completely opposite views on the reasons for the breakdown. Novogratz argued that the chances of SEC approval were almost zero under the regulatory environment at the time, and asserted that BitGo had failed to provide the required financial information on time, a necessary condition for Galaxy to conduct due diligence and complete the transaction. According to Novogratz, BitGo's failure to fulfill this obligation meant the company lost its right to claim the $100 million termination fee.
However, BitGo CEO Mike Belshe firmly refuted this, asserting that BitGo had provided all the necessary information as requested and that the $100 million fee was entirely legitimate.
