Bitcoin mining firm Hut 8 has agreed to pay $2.35 million to settle a securities class action lawsuit brought by investors. The lawsuit alleged that Hut 8 made misleading disclosures concerning operational risks and potential problems related to its 2023 merger with U.S. Bitcoin Corp., specifically regarding power and network connectivity issues at the King Mountain bitcoin mining facility in Texas, United States.
Investors claimed that Hut 8 overstated the benefits of the merger and failed to adequately disclose operational risks at the mining site, including unstable power supply and network connectivity delays, which affected their investment decisions. Under the settlement agreement, Hut 8 denies any wrongdoing or liability, stating that the settlement is intended to avoid further legal costs and disruptions.
According to documents, the $2.35 million settlement amount represents approximately 19.6% of the plaintiffs' estimated maximum recoverable damages of $12.08 million. The settlement still requires final approval from the court. The lawsuit was originally filed by investors in 2023, and the settlement was reached after nearly three years of negotiations.