Strategy Faces Multiple Class-Action Lawsuits Over Alleged Securities Fraud in Bitcoin Treasury Management

In Brief:

Strategy (formerly MicroStrategy) is facing five class-action lawsuits over its Bitcoin investment practices.

Lawsuits relate to $7.7B Bitcoin purchase in Q1 2024 and $6B in unrealized losses.

Strategy, the business intelligence firm formerly known as MicroStrategy, is currently involved in at least five class-action lawsuits, accusing the company of securities fraud related to its Bitcoin treasury management. The lawsuits stem from Strategy's $7.7 billion Bitcoin purchase in the first quarter of 2024, which resulted in around $6 billion in unrealized losses due to the downturn in cryptocurrency prices. Legal experts suggest that multiple law firms are vying for lead plaintiff status, with substantial legal fees at stake. Strategy has stated in SEC filings that it will vigorously defend against the allegations but cannot predict the outcome of the litigation.

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