MicroStrategy, recently branded as Strategy, is once more making headlines in the financial world.
Recognized for having the largest corporate Bitcoin reserve, the company is currently facing a class action lawsuit related to accusations of misleading accounting practices.
Nevertheless, it continues its Bitcoin acquisition strategy, reaching a total of 576,230 BTC, valued at around $59 billion.
On May 19, 2025, Strategy revealed it added 7,390 BTC for $764.9 million.
The average price per coin was around $103,498.
This purchase was made possible through an at-the-market (ATM) equity offering and the issuance of Series A STRK preferred stock.
This acquisition brings the company's total Bitcoin holdings to 576,230 BTC, with a new average cost basis of $69,726.
The announcement followed the company facing a lawsuit filed in Virginia's Eastern District.
The legal proceedings initiated by Pomerantz LLP involve both the company and its executives, accusing them of not adequately informing investors about risks associated with updated Bitcoin accounting standards under ASU 2023-08.
This new standard mandates firms to present the fair market value of Bitcoin on their financial statements.
As per the lawsuit, Strategy allegedly downplayed the implications of this requirement, resulting in a reported $5.91 billion fair-value loss that wasn’t clearly communicated to investors.
The complaint also addresses Strategy’s use of proprietary non-GAAP metrics, like “BTC Yield” and “BTC $ Gain”.
The plaintiffs assert that these terms are not standard financial measures and may have given an inflated perception of the company’s profitability.
The situation came to a head on April 7, when news of the $5.9 billion impairment loss surfaced, leading to an 8.67% drop in MSTR shares that day. By May 1, earnings reports confirmed the damage to the company's financials, and investor sentiment soured.
While proponents highlight the potential for Bitcoin appreciation and innovations in digital asset strategies, the lawsuit raises significant issues regarding adherence to regulations and transparency.
Experts in accounting have noted that non-GAAP metrics can be useful but must be employed with caution, particularly when they conflict with established accounting practices.
Even in the face of financial ramifications and legal threats, Strategy shows no intention of altering its course.
Their May disclosure indicates a strong commitment to accumulating Bitcoin, with the recent purchase marking one of the largest monthly acquisitions this year.
Michael Saylor, the company’s chairman, has consistently advocated viewing Bitcoin as "digital gold" and a long-term asset class.
His previously stated mantra, “My formula for success is to rise early, work late, and buy Bitcoin,” underscores the firm’s public position.
However, the ongoing legal case may influence how other corporations manage digital asset reporting in the future.
Please share by clicking this button!
Visit our site and see all other available articles!