Mining company Hut 8 has agreed to pay $2.35 million to settle a class-action lawsuit related to its merger with U.S. Bitcoin Corp. The settlement awaits approval from the U.S. District Court for the Southern District of New York, according to CoinDesk.
The complaint was filed on behalf of investors who bought or acquired Hut 8 securities in the U.S. or on an American exchange between February 13, 2023, and January 18, 2024. The company did not admit to any wrongdoing and stated that the settlement does not imply agreement with the allegations.
Details of the Lawsuit
The case is related to the merger of Hut 8 Mining Corp. and US Bitcoin (USBTC), completed in November 2023. The deal was executed through a stock exchange, and the combined entity was named Hut 8 Corp.
Plaintiffs claimed the company exaggerated the benefits of the merger and failed to disclose issues at the King Mountain mining facility in Texas. USBTC owned 50% of the King Mountain JV before the deal. According to Glancy Prongay & Murray, the claims included potential problems with power supply and high-speed internet at the facility, as well as allegations of an undisclosed related party among USBTC’s major shareholders.
The lawsuit also alleged that without the merger with Hut 8, USBTC might have faced bankruptcy, and its value was approximately 70% lower than what Hut 8 paid for the asset. Hut 8 and other defendants denied any violations.
Why the Settlement Amount Was Limited
On September 12, 2025, Judge Victor Marrero partially granted the defendants’ motion to dismiss the case. The court fully dismissed claims under the Exchange Act, leaving only those related to statements about King Mountain JV under the Securities Act. Claims concerning USBTC’s financial condition before the merger were also dismissed.
The dispute then focused on whether the deal materials adequately disclosed the risks at King Mountain. For a mining business, this is a significant factor: Bitcoin mining and hosting depend on stable access to electricity and network infrastructure.
How the Parties Reached an Agreement
On May 7, 2026, the parties held a one-day virtual mediation. It did not result in an immediate agreement, but on May 13, the parties accepted the mediator’s proposal. The formal settlement agreement is dated June 18.
Plaintiffs noted that $2.35 million represents about 19.6% of the maximum possible recovery of $12.08 million. They estimate this is above recent averages for settlements in cases where only Securities Act claims remained. The settlement requires preliminary and final court approval.
The merger of Hut 8 and USBTC was announced in February 2023. The companies stated that the merger would create a major public miner with 5.6 EH/s of installed self-mining capacity, 220 MW of hosting infrastructure at King Mountain, and approximately 825 MW of total capacity across all operations.
Following the deal, Hut 8 retained its mining business but also increased its focus on AI infrastructure and high-performance computing. In May, the company announced a 15-year lease for the first phase of the Beacon Point campus in Texas for $9.8 billion.
In March, Hut 8 introduced a modular infrastructure model that allows for flexible switching of computing power between AI tasks and Bitcoin mining.
