Strategy Faces Class Action Lawsuit Over Bitcoin Losses

An international law firm has initiated a class action lawsuit against Strategy, formerly known as MicroStrategy, and its founder, Michael Saylor. The lawsuit, filed by Pomerantz LLP, is on behalf of individuals who acquired Strategy securities between April 30, 2024, and April 4, 2025. The complaint alleges that Strategy made materially false and misleading statements regarding its profitability and the risks associated with its Bitcoin investments.

The lawsuit claims that Strategy overstated the anticipated profitability of its Bitcoin-focused investment strategy and treasury operations. It also alleges that the firm understated the risks associated with Bitcoin's volatility and the potential magnitude of losses on the value of its digital assets. According to the press release, Strategy disclosed an unrealized loss of $5.91 billion with the U.S. Securities and Exchange Commission (SEC) earlier this month after adopting updated accounting methods this year. Following the SEC filing, Strategy warned investors that they might not regain profitability in future periods.

Despite the disclosure of significant losses, Strategy announced another large purchase of coins on the same day the lawsuit was launched. This move highlights the firm's continued commitment to its Bitcoin investment strategy, despite the potential risks and uncertainties associated with digital assets. The lawsuit underscores the importance of transparency and accurate disclosure in the financial markets, as investors rely on this information to make informed decisions.

The outcome of this lawsuit could have significant implications for the cryptocurrency industry and the regulatory environment surrounding digital assets. It serves as a reminder to investors to conduct thorough due diligence before making any high-risk investments in digital assets. The lawsuit also highlights the potential risks and uncertainties associated with investing in Bitcoin and other digital assets, and the importance of accurate disclosure in the financial markets.