Swan Bitcoin Sued for Allegedly Withdrawing $1B Before Prime Trust Bankruptcy
- Prime Trust’s post-bankruptcy trust filed a lawsuit against Swan Bitcoin, claiming nearly $1 billion was withdrawn before its collapse.
- The suit alleges Swan received over $24.6 million in cash and withdrew approximately 11,994 Bitcoin (valued at around $923 million) just days prior to the August bankruptcy.
- An unidentified senior executive from Prime Trust reportedly had a side advisory role with Swan since July, facilitating insider information.
- Four days before a key regulatory meeting, this executive allegedly communicated with Swan’s CEO using an encrypted chat that auto-deleted messages.
- The lawsuit seeks recovery under the Bankruptcy Code for preferential and fraudulent transfers made by Swan.
The allegations suggest that Swan exploited insider access to withdraw funds ahead of other customers as Prime Trust faced financial instability. This case highlights potential misconduct in asset management during critical financial events.
Swan Bitcoin is accused of transferring significant assets just before Prime Trust’s bankruptcy filing, including 5 million USDt (USDT) and various digital assets.(Source)
