Crypto investment firm Galaxy Digital has cancelled its $1.2 billion acquisition agreement with digital asset custodian BitGo.

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Galaxy terminated the deal after the San Francisco-based startup missed a July 31st deadline to deliver audited financial statements for 2021 that comply with the requirements of the agreement, according to a Monday press release. Galaxy will not have to pay a termination fee.

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Mike Novogratz, CEO, and Founder of Galaxy stated, “Galaxy remains positioned for success and to take advantage of strategic opportunities to grow in a sustainable manner. We are committed to continuing our process to list in the U.S. and providing our clients with a prime solution that truly makes Galaxy a one-stop shop for institutions,”

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BitGo has disputed Galaxy Digital’s claim, saying the expiry on the deal was until December 31st “at the earliest” and that it failed to pay out a $100 million reverse break fee "promised back in March 2022 in order to induce BitGo to extend the merger agreement."

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“The attempt by Mike Novogratz and Galaxy Digital to blame the termination on BitGo is absurd,” said R. Brian Timmons, a partner with Quinn Emanuel, the law firm BitGo has hired.

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Timmons pointed to Galaxy's $554 million loss during Q2, in addition to its stock performing poorly and the company being distracted by the Terra Luna crash.

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"Either Galaxy owes BitGo a $100 million termination fee as promised or it has been acting in bad faith and faces damages of that much or more,” he added.

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