Cryptocurrency exchange Gemini is facing a new class-action lawsuit alleging that it misled investors during and after its initial public offering (IPO). A group of Gemini shareholders has taken the company to court.
In their lawsuit, the plaintiffs claim that Gemini's pre- and post-IPO filings portrayed the company as a growth-oriented crypto exchange focused on expanding its user base and international operations. However, the company subsequently underwent a "sudden corporate strategic adjustment, shifting to a predictive market-centric business model."
The lawsuit asserts that the offering documents contained "materially false and misleading statements" and failed to disclose that Gemini "was preparing for a costly and disruptive restructuring."
Additionally, the suit mentions that the company had pledged to expand its operations into "key global markets."
Gemini Implements Operational Adjustments
According to the lawsuit, these strategic and operational changes have led to a decline in stock prices, causing the plaintiff group to suffer "significant losses and damages."
Consequently, the lawsuit demands a jury trial and seeks compensation for investors who purchased shares at "artificially inflated prices" after the IPO.
As of press time, Gemini's stock price rose 0.81% at Thursday's close and surged an additional 5.8% in after-hours trading.