Mining company Stronghold agrees to pay $4.75 million and 25 bitcoins to settle class action lawsuit

ChainCatcher news, Stronghold Digital has agreed to pay $4.75 million and 25 bitcoins to settle a class action lawsuit accusing it of exaggerating its bitcoin mining capabilities during its 2021 IPO. According to court documents, the settlement agreement was reached after a year of mediation and will be paid in installments over the next 24 months in bitcoin.

The lawsuit was filed in April 2022 by plaintiffs in the Southern District of New York. Under the proposed settlement agreement, Stronghold and the underwriters (the group of investment banks responsible for Stronghold's 2021 IPO) agreed to pay compensation in cash and bitcoin after a year of mediation. The value of the bitcoin portion is based on the current bitcoin price (around $90,000), amounting to approximately $2.2 million.