Prime Trust’s financial troubles are just a ripple in the ocean of crypto, experts say

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Crypto custodian Prime Trust may be under scrutiny, but the broader digital asset market appears to be in a recovery phase and is poised to grow in the coming years, observers say.

What happened: The Nevada Department of Business and Industry declared Prime Trust “seriously deficient” and in “a dangerous or unhealthy condition.” The order comes after crypto custodial firm BitGo ended its plans to acquire Prime Trust, citing an unworkable partnership.

The development led to a lack of customer funds and the company’s inability to honor customer withdrawals. Prime Trust “materially and willfully” breached its fiduciary duties by failing to protect assets in its custody, regulators argued. The company is also accused of being unable to meet all disbursement requests from customers.

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What the experts say: The crypto industry is transitioning from a “crypto winter” to a “crypto spring,” according to Pastel Network co-founder Anthony Georgiades.

Geogriades, a general partner at Innovating Capital, noted that the 2022 liquidations have mostly passed and the industry is now in a recovery phase, citing BlackRock’s recent filing for a Bitcoin ETD.

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As for Bitcoin (CRYPTO:BTC), it is difficult to predict where it is heading, he adds.

Currently, the industry is in an accumulation phase where retail and institutional investors are increasing their exposure to Bitcoin, Ethereum, and other major digital assets. A new bull run triggered by the Bitcoin halving event expected next year is possible.

Ethernity Chain CEO Nick Rose Ntertsas does not believe Prime Trust’s issues will have a significant impact on the broader digital asset market.

Like Georgiades, Ntertsas suggests the market is now in a recovery phase. Expect a slow and choppy ascent for Bitcoin and other major crypto assets in the coming months, he warns.

Also Read:Singapore MAS Unveils Groundbreaking Framework for Digital Asset Ecosystem

Umee CEO Brent Xu also doubts that the issues Prime Trust is facing are representative of systemic issues within the crypto market.

The industry has shifted to another part of the cycle, with investors turning to BTC and other digital assets in a more pronounced way, he explained.

Wider adoption of digital assets is likely, especially in Asia, the Middle East and Europe, where regulatory guidelines are clearer, he adds.

Read Next:Circle CEO Jeremy Allaire Praises Hong Kong as New Epicenter of Crypto Focus

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