Galaxy Digital founder Mike Novogratz and Bitgo CEO Mike Belshe testified this week in Delaware Chancery Court over a failed $1.2 billion merger that collapsed in 2022, with Bitgo seeking at least $100 million in damages.
Key Takeaways:
Bitgo is seeking at least $100 million from Galaxy Digital over a failed 2021 merger worth $1.2 billion.Galaxy’s Mike Novogratz testified this week that U.S. regulatory probes did not affect the merger’s approval path.Chancellor Kathaleen McCormick will decide the case after Delaware’s Supreme Court revived it in May 2024.Bitgo disputed that position. According to Bloomberg, CEO Mike Belshe testified that Bitgo provided the required documentation and that Galaxy’s termination claims caused direct harm to the company. Bitgo is seeking at least the $100 million reverse breakup fee written into the merger agreement, and argues actual damages may exceed that figure.
“This was incredibly damaging,” Belshe is cited as saying in court, according to Bloomberg’s Sabrina Willmer.
Novogratz addressed several issues during his testimony. He stated that U.S. regulatory inquiries did not target Galaxy directly and had no bearing on the merger’s regulatory approval path. He also discussed Galaxy’s Luna trading profits of nearly $400 million, saying those sales were made to reduce risk.
The Delaware Supreme Court reversed that ruling in May 2024. Justices found the merger agreement’s definition of “financial statements” was ambiguous and that both sides offered reasonable interpretations. The case was sent back to the lower court.
Proceedings have continued since, including discovery disputes. The trial before Chancellor Kathaleen St. Jude McCormick is now underway. No final ruling has been issued as of May 23, 2026.
Possible outcomes include Galaxy paying the $100 million termination fee, a larger damages award, a settlement between the parties, or a ruling in Galaxy’s favor. The court, not a jury, will decide.
