According to Foresight News, Stronghold Digital has agreed to a settlement involving a payment of $4.75 million and 25 bitcoins to resolve a class-action lawsuit. The lawsuit accused the company of overstating its bitcoin mining capabilities during its 2021 initial public offering (IPO). Court documents reveal that the settlement was reached after a year of mediation and will be paid in installments over the next 24 months.
The lawsuit was filed in April 2022 by plaintiffs in the Southern District of New York. Under the proposed settlement agreement, Stronghold and its underwriters, a group of investment banks responsible for the company's 2021 IPO, agreed to the compensation in both cash and bitcoin. The bitcoin portion of the settlement is valued at approximately $2.2 million, based on the current bitcoin price of $90,000.
This settlement marks a significant development in the legal proceedings surrounding Stronghold Digital's IPO, addressing the allegations of misrepresentation in its bitcoin mining capacity. The resolution aims to provide compensation to the affected parties while allowing Stronghold to move forward from the legal challenges associated with its public offering.
