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Briefly
- The California investor accused the strategy and her executives of making false and misleading statements about the profitability of his Bitcoin Treasury Strategy.
- Listing the fall of its Bitcoin Holdings, the strategy revealed a loss in the first quarter in the amount of $ 4.2 billion earlier this year.
- The strategy reportedly failed to detect the scope of losses that could arise from the accounting standard for Bitcoin, promoting the “pink assessment” of shift.
A headquarters in California accused the strategy, earlier Micro -zoneand his leaders of the violation of the Federal Laws on securities by giving false and misconceptions, according to the appeal filed at the US District Court for the Eastern Virginia district on Friday.
In a 38 -page document, Anas Hamza claimed that the strategy and her executives, including the co -founder and executive President Michael Saylor, failed to discover that “the expected profitability of the investment strategy focused on the Bitcoin focused on the company transformed.”
An appeal, which does not determine the damage, claimed that the company based in Tyson, Virginia failed to detect “the loss strategy could recognize the values of digital assets after accepting the” accounting standards of FER-RANCOIN for Bitcoin, while “pink assessments of the strategy as a Bitcoin Treasuy Company”.
Hamza’s lawsuit, led by lawyers in Pomerantz, was also appointed executive director of Strategy Phong LE and Cinemas Chief Director Andrew Kang as defendants.
In the submission of the Securities Commission and Exchange Strategy said On Monday, it is planned to “vigorously defend” from Hamza’s claims, adding that it cannot “predict the outcome or provide a reasonable assessment” of the costs related to legal efforts at the moment.
Strategy did not immediately respond to a commentary request from Decipher.
The strategy began storage of bitcoin under Saylor’s leadership in 2020, and is currently holding about 576.00 Bitcoin worth $ 60.6 billion, based on liquid prices. In January, he started following his Bitcoin Holdings by fair value, and gain and losses were reported as a quarterly revenue.
Strategy warned At the beginning of April, it did not foresee profitable first quarter, citing a drop of $ 5.91 billion worth of its Bitcoin Holdings on paper, during a quarterly period. The company later discovered Loss in the first quarter of $ 4.22 billion or $ 16.49 per share.
According to the second accounting model, which Bitcoin Holdings classified as an intangible property, the company should only recognize the reduction if the price of property drops. Only in case the strategy sold Bitcoin, the company would “mark” the value of its Bitcoin Holdings.
The decision of the strategy to consistently emphasize the key performance indicators, including the BTC yielding-which it monitors changes in the ratio between Bitcoin Holdings and the usual shares-ways in which the company and executives allegedly reduce the risk of transition to honest accounting standard for their Bitcoin posture.
The Committee on Financial Accounting Standards, or FASB, approved for the FER value of accounting of digital assets 2023. The strategy was among the companies that advocated a change, citing ua letter To “allow us to give investors a more relevant view of our financial position and economic value of our Bitcoin Holdings.”
Pomerantz did not immediately respond to a commentary request from Decipher.
Edited by James Rubin
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