According to Bloomberg, the proposed class action lawsuit against a strategy that accused the business intelligence company and its executive committee chairman Michael Saylor of misleading investors misleading the risks of purchasing significant bitcoin, has been voluntarily dismissed.
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Investors voluntarily dismissed the proposed class action lawsuit against the strategy, claiming that the company around Bitcoin risk and accounting misunderstands shareholders. The lawsuit, filed in May, accused Michael Saylor and other executives of exaggerating Bitcoin’s profits and obscuring volatility and accounting impact.
According to a Bloomberg report on August 29, investors voluntarily dismissed their proposed class action against a strategy with bias and ended the lawsuit permanently.
The lawsuit, originally filed in the Eastern District Court of Virginia in May by law firm Pomerantz LLP, appointed executives such as Michael Saylor, CEO Phong Le and CFO Andrew Kang as defendants.
The plaintiffs argued that while the strategy exaggerates potential benefits from the Bitcoin strategy, it underestimated volatility risk and did not clearly articulate the effectiveness of adopting new accounting standards for digital assets. The plaintiff’s sudden decision to withdraw all claims filed exactly one day before August 28th has not been made public about their resignation.
Accounting shifts and increasing criticism
Earlier this year, the strategy adopted the Financial Accounting Standards Committee’s Accounting Standards Update No. 2023-08. This manages the accounting of crypto assets. The move to fair value accounting allowed the company to record large Bitcoin holdings at market value quarterly, with unrealized profits and losses flowing directly into the statement of net income.
The plaintiffs allegedly failed to fully disclose how this would affect reported revenues, proving that accounting methods are being presented to investors in a misleading light, pointing to the strategy’s $4.22 billion net loss in the first quarter of 2025.
In addition to litigation, the strategy faces scrutiny in other aspects. Earlier this month, a well-known Wall Street Advisor criticized the company for comparing its metrics to technology giants such as Apple and Nvidia, claiming that recent performance was driven by a single surge in Bitcoin, rather than sustainable revenue growth.
Responsibility highlighted growing skepticism from some of the financial facilities about whether a unique model of strategy should be benchmarked against traditional company peers.
Despite criticism, the strategy remains Bitcoin’s biggest corporate holder, with 632,457 BTC on the balance sheet, worth around $68.32 billion, according to Bitcoin’s.net.
On August 25, Michael Saylor highlighted that the company’s own Bitcoin yield metric has risen to 25.4% since the start of the year, framing it as evidence of long-term shareholder value associated with Bitcoin accumulation.
