BitGo Emerges as Prime M&A Target as Wall Street Eyes Institutional Crypto Expansion

Wall Street analysts are increasingly optimistic about BitGo’s expansion into full-service institutional crypto finance, viewing the company as a potential acquisition target for traditional financial firms seeking faster entry into digital assets. As institutional demand for crypto infrastructure grows, BitGo’s diversified offerings could position it at the center of future mergers and acquisitions.

Compass Point analyst Ed Engel, who maintains a buy rating on BitGo (BTGO), believes the company’s comprehensive suite of crypto services makes it an attractive takeover candidate. According to Engel, BitGo’s custody, prime brokerage, and digital asset security solutions could be seamlessly integrated into traditional prime brokerage platforms. This strategic positioning may appeal to established Wall Street firms aiming to expand their crypto product offerings without building infrastructure from scratch.

BitGo was among the first digital asset custody firms to go public this year, giving equity investors direct exposure to crypto infrastructure. While many investors remain focused on BitGo’s core custody business, Engel points to significant upside in its ability to cross-sell prime brokerage services. He noted that Galaxy Digital’s average revenue per trading counterparty is roughly six times higher than BitGo’s, highlighting substantial growth potential if BitGo scales its prime services effectively.

Canaccord Genuity shares a similar outlook, assigning a $15 price target and calling BitGo an efficient “time-to-market” acquisition opportunity for traditional finance players entering crypto. The firm’s competitive moat and established institutional client base strengthen its appeal.

BitGo’s acquisition potential is not new. In 2021, Galaxy Digital agreed to acquire the company for $1.2 billion before terminating the deal. Today, with BitGo publicly traded and valued near $1.24 billion following a 40% stock decline since its IPO, analysts argue the selloff may be overdone. With nine buy ratings and price targets ranging from $12 to $18, Wall Street sees meaningful upside as crypto markets stabilize.