#United States #New York #Class Action #Pomerantz #Bitfarms

Pomerantz Law Firm Files Class Action Against Bitfarms

On June 22, 2025, the Pomerantz Law Firm announced that it has filed a class action lawsuit against Bitfarms Ltd., a publicly traded cryptocurrency mining firm, and certain executives of the company. The lawsuit, lodged in the United States District Court for the Eastern District of New York, represents a group of investors who acquired Bitfarms securities between March 21, 2023, and December 9, 2024. The lawsuit aims to recover losses incurred by investors due to alleged violations of federal securities laws.

Allegations Against Bitfarms

The class action comes in the wake of significant disclosures by Bitfarms regarding its financial practices, particularly surrounding its classification of digital asset sales. The complaint points to a consistent pattern of misleading statements and omissions made by Bitfarms executives that artificially inflated the company's stock value during the class period. Investors are particularly concerned about how Bitfarms inaccurately reported financial data, which they contend misled them regarding the company's operational integrity and performance.

One focus of the lawsuit is the company's handling of its 2021 Warrants. The Pomerantz firm claims that Bitfarms failed to adequately address internal control deficiencies related to financial reporting. Specifically, it’s alleged that the company misclassified proceeds from digital asset sales, incorrectly categorizing them as operating cash flows instead of investing cash flows, which is mandated by accounting standards.

Following a significant press release on December 9, 2024, Bitfarms revealed that it needed to restate its consolidated financial statements for 2022 and 2023 due to the material misclassification of those proceeds. This announcement resulted in a sharp decline of Bitfarms' stock price, a move that many investors viewed as a direct consequence of prior misstatements by the executive team.

Investor Representation

Investors who acquired Bitfarms securities during the identified class period have until July 8, 2025, to join the class action lawsuit. The firm encourages those who wish to be represented to reach out through their dedicated channels. Danielle Peyton, an attorney at Pomerantz LLP, has been designated as the contact person for this class action, guiding potential plaintiffs through the process of joining the legal proceedings. Interested investors can obtain a copy of the complaint and get further details through the firm’s website.

Bitfarms: A Snapshot

Bitfarms operates large-scale integrated Bitcoin data centers across multiple countries, including Canada, the U.S., Paraguay, and Argentina. Their operations include the validation of Bitcoin transactions—a process termed mining—which is crucial for the functionality of the Bitcoin blockchain. The company has claimed that its strategy involves the selling of mined Bitcoin as part of managing its assets and funding operations.

In terms of financial strategy, the listing of needs highlighted by the class action lawsuit has prompted discussion regarding Bitfarms' financial reporting practices. Investors are particularly concerned about how Bitfarms manages its digital assets and reports on the associated cash flow that arises from their sale.

The class action further sheds light on the broader concerns surrounding cryptocurrency firms, specifically relating to transparency and integrity in financial reporting. Such legal actions can serve as both a warning and a potential turning point for other firms in the cryptocurrency sector.

Pomerantz LLP’s longstanding history and expertise in navigating corporate securities cases have positioned them as a formidable advocate for investors seeking redress from corporate malfeasance. The firm, known for its rigorous approach to securities litigation, emphasizes the protection of investors' rights and aims to hold corporations accountable for their actions.

Bitfarms has indicated its intention to comply with necessary regulatory requirements and implement corrective measures in response to the identified weaknesses. These developments will be closely monitored by both the investors and market analysts observing Bitfarms' strategic navigation through this legal challenge.

For further assistance or inquiries related to the case, interested parties are urged to contact Pomerantz LLP directly. The outcomes of this lawsuit could set important precedents for the cryptocurrency market, particularly regarding how companies report their financial health and manage regulatory compliance amid growing scrutiny from investors and the public.