Prime Trust Litigation Trust Files 94-Page Suit Against Swan Bitcoin for $970M in Transfers

Prime Trust Clawback Case Targets Swan Bitcoin

The PCT Litigation Trust, created nether Prime Core Technologies’ confirmed Chapter 11 plan, filed the action successful the U.S. Bankruptcy Court for the District of Delaware. The suit targets Electric Solidus, Inc., the genitor entity operating nether the Swan Bitcoin name.

At the halfway of the ailment is astir 11,994 BTC, valued astatine astir $938 cardinal astatine caller prices. The spot besides seeks to retrieve astir $24.66 cardinal successful cash, $5 cardinal successful stablecoins including USDT and USDC, and 91,144 XRP.

Prime Trust, a Nevada-regulated crypto custodian, began showing signs of superior fiscal strain successful 2023. The institution mislaid entree to a wallet holding astir $80 million, reportedly utilized lawsuit funds to screen front-facing withdrawals, and carried fiat liabilities of much than $85 cardinal against astir $3 cardinal connected hand.

Nevada regulators issued a cease-and-desist bid successful June 2023, placed Prime successful receivership, and the institution filed for Chapter 11 connected Aug. 14, 2023. The PCT Litigation Trust alleges that during the 90-day penchant model earlier that filing, specifically betwixt May 16 and Aug. 14, 2023, Swan pulled ample volumes of BTC, cash, stablecoins, and XRP from Prime portion the custodian was insolvent.

The spot acknowledges Swan contributed immoderate caller worth during that period, astir 1.44 BTC and $2.22 cardinal successful cash, but argues the nett vulnerability remains significant. A cardinal allegation successful the ailment involves what the spot describes arsenic an insider tip. A elder Prime Trust enforcement who besides served arsenic a paid advisor to Swan and reportedly lived adjacent Swan CEO Cory Klippsten, allegedly alerted Swan to Prime’s deteriorating condition.

The ailment points to an encrypted, auto-deleting chat that began May 22, 2023, days earlier a captious Nevada Financial Institutions Division gathering connected May 26. The spot alleges Swan utilized that accusation to accelerate withdrawals up of different creditors and customers. Swan is said to person moved lawsuit assets to Fortress and Bitgo good earlier the firm’s collapse, completing transfers weeks successful beforehand successful June 2023.

The institution said astatine the clip the moves were related to strategy upgrades. The spot besides challenges the ineligible operation of however assets were held. Governing agreements betwixt Swan and Prime, including Order Forms, an API Agreement, and a Custodial Agreement, explicitly disclaimed fiduciary duties and allowed Prime to commingle assets.

The ailment alleges that a ledger introduction labeled “PT FBO Swan Customers” was created connected May 25, 2023, to springiness the quality of segregation, days aft the alleged insider connection began. A July 18, 2025, ruling by Judge J. Kate Stickles determined that assets successful Prime’s possession astatine the clip of filing were portion of the bankruptcy property owed to commingling and the contractual presumption of its agreements.

That determination enabled the Plan Administrator to dainty spouse assets arsenic property property, with definite carve-outs reserved for parties including Swan during earlier proceedings. Swan, however, has pushed backmost against the claims. The institution has stated that Prime Trust held lawsuit spot successful individually owned spot accounts, and that the bankruptcy property is present trying to assertion assets it held arsenic custodian from a enactment that ne'er received them.

Swan has objected to specified claims successful past filings, arguing that lawsuit assets held by a spot institution are not disposable to wide unsecured creditors. The institution said it expects the courts to agree. Still, nary ceremonial effect to the May 15 ailment has been filed arsenic of May 18, 2026. The lawsuit is assigned to Judge Stickles nether Adversary Proceeding No. 26-50331.

The PCT Litigation Trust has filed akin clawback actions against different erstwhile Prime partners, including Strike, Compass Mining, Fold, and Galaxy Digital. Each lawsuit centers connected akin questions astir plus segregation, commingling, and penchant transfers successful the months earlier Prime’s bankruptcy filing.

How courts regularisation connected Swan’s fiduciary and penchant defenses volition apt signifier outcomes crossed respective related actions inactive moving done the Delaware docket.