According to The Block, the Nevada Financial Institutions Department (FID) has filed a petition with the Eighth Judicial District Court of Nevada, requesting the appointment of a receiver to take over the daily operations of the cryptocurrency custodian Prime Trust and examine all its financial conditions, "either restoring the company and handing it over to private management, or liquidating the company to protect Prime Trust customers." According to the annex to its document, Prime Trust's management committee agreed to take over.
The FID stated that Prime was operating in an unsafe and unsound manner, had no funds to pay customer deposits, and was unable to continue its cryptocurrency custody services.
FID documents show that Prime Trust lost access to old wallets as early as 2021 and used customers' assets to repurchase cryptocurrencies.
Data shows that Prime Trust owes clients $85.67 million in fiat assets, but Prime Trust only holds $2.904 million. Prime Trust owes clients $69.509 million in digital assets, but only holds $68.648 million.