Swan Bitcoin faces nearly $1 billion lawsuit over Prime Trust collapse, accused of using insider information to transfer assets early

Odaily Planet Daily reported that Bitcoin financial services company Swan Bitcoin (and its operating entity Electric Solidus Inc. are listed as defendants) is facing a lawsuit filed in the U.S. Bankruptcy Court for the District of Delaware, with claims totaling nearly $1 billion.

The lawsuit was filed by PCT Litigation Trust, seeking to recover crypto assets related to the 2023 Prime Trust collapse. The plaintiff alleges that Swan used "non-public insider information" to transfer funds before Prime Trust's bankruptcy, thereby avoiding significant losses.

According to court documents, Swan had transferred approximately 11,992 Bitcoin (currently valued at around $917 million) along with other assets out of Prime Trust before it filed for bankruptcy. This also included approximately $22.4 million in fiat currency, $5 million in stablecoins, and 91,444 XRP.

The plaintiff also pointed out that Swan had ties to a senior executive at Prime Trust, who also served as an external advisor to Swan and allegedly provided information to Swan ahead of regulatory meetings, helping it withdraw assets early.

Swan Bitcoin responded that the assets in question belong to customer trust property and should not be used for bankruptcy liquidation, and believes the court will ultimately support its position. (Decrypt)