Strategy Buys $765M in Bitcoin Amid Lawsuit and Short-Seller Pressure

Business intelligence firm Strategy has expanded its Bitcoin portfolio once again, acquiring an additional $765 million worth of BTC. With this latest purchase, Strategy now holds 576,240 Bitcoins, making it the largest corporate holder of the leading cryptocurrency. The firm’s average purchase price is approaching $70,000 per coin, a bold move that continues to stir controversy in financial circles.

The company’s aggressive Bitcoin accumulation strategy has attracted criticism and skepticism. Notably, famed short-seller Jim Chanos, known for exposing Enron before its collapse, has reportedly shorted Strategy while simultaneously buying Bitcoin as a hedge. In response, co-founder Michael Saylor posted on social media: “Never short a man who buys orange ink by the barrel,” referencing a classic Wall Street saying with a Bitcoin twist.

However, Strategy is now facing more than just criticism from short-sellers. A class action lawsuit filed on May 16 in a Virginia federal court accuses the company, Saylor, CEO Phong Le, and CFO Andrew Kang of violating securities laws. The plaintiff, Anas Hamza, alleges that Strategy misled investors by downplaying the risks associated with its Bitcoin-heavy investment approach.

According to the lawsuit, Strategy failed to properly disclose the volatility and regulatory uncertainties surrounding Bitcoin, potentially misleading shareholders. In a recent filing, the company stated that it would "vigorously" defend itself against the claims.

Following the news, Strategy’s shares dipped 2% in pre-market trading. Despite the legal challenges and growing opposition from financial skeptics, the company remains committed to its Bitcoin-first corporate strategy, continuing to double down on its belief in the long-term value of the cryptocurrency.