Former bitcoin miner Hut 8 (HUT) has agreed to pay $2.35 million to settle a securities class action lawsuit alleging it misled investors in connection with its 2023 merger with US Bitcoin Corp. (USBTC).
The lawsuit, filed in the U.S. District Court for the Southern District of New York, focused on Hut 8’s all-stock merger with USBTC, which closed in November 2023.
Investors alleged that the company, which now focuses on high-performance computing and artificial intelligence data centers, exaggerated the benefits of the transaction and failed to disclose persistent power constraints and internet connectivity issues at King Mountain, a Texas bitcoin mining joint venture in which USBTC had a 50% stake.
The litigation gained momentum after short seller J Capital Research published a critical report in January 2024, causing Hut 8’s share price to drop more than 23%.
According to a court filing, the $2.35 million recovery represents approximately 19.6% of the estimated maximum recoverable damages, exceeding the 12.9% average and 14.6% average recovery rates for settlements based solely on the Securities Act in 2025.
As part of the agreement, Hut 8 denies any wrongdoing or liability. Hut 8 shares have gained more than 640% over the past year.
