Crypto mining firm Argo Blockchain has been accused of making false statements and omitting key information during its initial public offering (IPO) in 2021. Several investors filed a lawsuit against Argo, its executives, and board members on January 26.
The firm is alleged to have failed to disclose how susceptible it was to capital constraints, electricity costs, and network difficulties. The lawsuit states that the Offering Documents were negligently prepared and contained untrue statements of a material fact or omitted to state other facts necessary to make the statements made not misleading.
Moreover, the investors said the business was less sustainable than they had been led to believe which led to an overstatement of the miner’s financial prospects. The lawsuit highlighted that had the investors known the truth, they would not have purchased or otherwise acquired the said securities. The investors would not have purchased or acquired the assets at the inflated prices that were paid.
The lawsuit follows Agro’s regained compliance with Nasdaq’s listing rule on January 23, which requires a company to maintain a minimum closing bid price of $1 for 10 consecutive trading days. The crypto miner made some difficult decisions to circumvent the ongoing bear market. On December 28, Agro said it would be selling its flagship mining facility – Helios for $65 million.
