Hut 8 to pay $2.35 million to settle investor suit over U.S. Bitcoin merger
CoinDesk 2026-06-23 09:57:11
Context: Hut 8, a former bitcoin miner, has agreed to pay $2.35 million to settle a securities class action lawsuit alleging the company misled investors regarding its 2023 merger with U.S. Bitcoin Corp. The lawsuit, filed in the U.S. District Court for the Southern District of New York, centered on Hut 8's all-stock merger with USBTC, which closed in November 2023. The deal requires court approval and ends a securities class action that followed a share price decline after a critical short-seller report in early 2024.
Key Facts
- Hut 8 agreed to pay $2.35 million to settle an investor suit alleging the company failed to disclose operational issues at a key mining venture acquired through its 2023 merger with U.S. Bitcoin Corp.
- The lawsuit focused on Hut 8's all-stock merger with USBTC, which closed in November 2023, and alleged that the company overstated the transaction's benefits while failing to disclose persistent energy curtailment and internet connectivity issues at King Mountain, a Texas bitcoin mining joint venture in which USBTC held a 50% interest.
- The litigation gained momentum after short seller J Capital Research published a critical report in January 2024, prompting a slide of more than 23% in Hut 8's share price.
- According to a court filing, the $2.35 million recovery represents roughly 19.6% of the estimated maximum recoverable damages, exceeding the 12.9% median and 14.6% average recovery rates for Securities Act-only settlements in 2025.
- As part of the agreement, Hut 8 denies any wrongdoing or liability, and the company's shares have gained more than 640% over the past year.