Hut 8 Settles $2.35M Investor Suit Over Merger

Bitcoin mining company Hut 8 has agreed to pay $2.35 million to settle a class-action lawsuit alleging it misled investors during its 2023 merger with U.S. Bitcoin Corp. The settlement, which requires approval from a federal judge, resolves claims that the company concealed significant operational problems at a Texas mining facility.

The lawsuit, filed in the U.S. District Court for the Southern District of New York, alleged that Hut 8 made false or misleading statements about the benefits of the all-stock merger, which was finalized in November 2023. Investors claimed the company failed to disclose recurring power issues and unreliable internet connectivity at the King Mountain mining site in West Texas, a joint venture in which U.S. Bitcoin Corp held a 50% stake. The plaintiffs argued these omissions were material, as the site's profitability depended on constant power and high-speed connectivity.

Hut 8 has denied all allegations of wrongdoing and stated the settlement is not an admission of liability. In court filings, the company said it agreed to the payment to avoid the costs and distraction of continued litigation. As part of the settlement, the plaintiffs cannot refile...