Strategy adds 7,390 BTC for $765M, gets hit with class-action lawsuit

MicroStrategy, now known as Strategy, significantly increased its Bitcoin holdings last week, acquiring 7,390 BTC for approximately $764.9 million, despite facing a class-action lawsuit. This purchase, averaging just under $103,500 per Bitcoin, follows a May 18th hint from executive chairman Michael Saylor on X. The company’s SEC filing details a lawsuit alleging misrepresentation of Bitcoin investment risks and profitability. Defendants include Saylor, President and CEO Phong Le, and CFO Andrew Kang. The suit claims they failed to adequately disclose the volatility risks associated with the company’s Bitcoin-focused strategy.

While the lawsuit alleges misrepresentation of risk, 0xngmi, a DefiLlama developer, argues the suit lacks merit, suggesting the inherent volatility of a Bitcoin-centric investment strategy was not understated. Strategy’s substantial Bitcoin holdings, totaling 576,230 BTC acquired at an average price of $69,726, are currently valued at over $59.2 billion, representing a $19.2 billion unrealized gain (47%). This significant profit contrasts with the lawsuit’s claims.

Strategy’s bold Bitcoin strategy is influencing other companies. Luxury watchmaker Top Win rebranded as AsiaStrategy, adopting a similar Bitcoin accumulation strategy in partnership with Sora Ventures, a firm also involved in creating Japan’s first corporate Bitcoin treasury with Metaplanet. Metaplanet’s Bitcoin holdings now surpass those of El Salvador. Further demonstrating this trend, a Bahraini catering company also embraced a Bitcoin treasury strategy, partnering with 10X Capital.

This surge in corporate Bitcoin adoption highlights a growing trend, with Strategy’s actions, despite the ongoing legal challenge, continuing to inspire similar strategies among other businesses. The lawsuit itself raises important questions about transparency and risk disclosure in corporate Bitcoin investments, shaping the narrative surrounding this burgeoning trend.