Former bitcoin miner Hut 8 (HUT) agreed to pay $2.35 million to settle a securities class action lawsuit that alleged it misled investors over its 2023 merger with US Bitcoin Corp. (USBTC).
The lawsuit, filed in the U.S. District Court for the Southern District of New York, focused on Hut 8’s all-stock merger with USBTC, which closed in November 2023.
Investors claimed the company, which is now focusing on AI data centers and high-performance computing, overstated the transaction’s benefits while failing to disclose ongoing energy cuts and internet connectivity issues at King Mountain, a Texas bitcoin mining joint venture in which USBTC held a 50% stake.
The lawsuit gained momentum after short-seller J Capital Research published a critical report in January 2024, leading to a more than 23% drop in Hut 8’s share price.
According to a lawsuit, the $2.35 million recovery represents about 19.6% of estimated maximum damages, exceeding the 12.9% median and 14.6% average recovery rates for the 2025 securities laws.
As part of the agreement, Hut 8 disclaims any wrongdoing or liability. Hut 8 shares have risen more than 640% over the past year.
