Previously, the firm recorded its Bitcoin at original purchase cost; while it could write down drops in the token’s value as “impairment charges,” it could not mark up price increases unless tokens were sold off.
Investors who filed suits against Strategy and its leadership earlier this year argued the company misled them by overstating the positive impact this new accounting strategy would have on the firm’s profitability.
When Strategy announced a net loss of $4.22 billion in the first quarter of 2025—despite Bitcoin’s historic surge over the prior six months—shareholders began revolting.
But on Thursday, plaintiffs in one of the most prominent lawsuits against the company opted to voluntarily dismiss their claims. The jointly stipulated dismissal, filed in a federal court in eastern Virginia, where Strategy is based, was made with prejudice—meaning the claims cannot be made in court again.
Decrypt reached out to the plaintiffs’ attorneys asking why they had dropped their claims, or if any settlement had been reached with Strategy, but did not immediately receive a response.
In recent weeks, Strategy has faced other criticisms about how it presents its unorthodox business model to shareholders.Earlier this month, a prominent Wall Street advisor slammed the company for comparing its price-to-earnings ratio to the likes of Apple and Nvidia—a move that was “100% fraudulent,” the advisor said, because the company’s recent performance was driven by a “one-off” increase in Bitcoin’s price, not business fundamentals likely to recur.
decrypt.co
