A securities class action has been filed against BitGo Holdings Inc. alleging the company misled investors about its exposure to digital asset price declines. BTGO shares lost more than 57% from their $18 IPO price after the crypto custodian reported a $14.8 million net loss for 2025, swinging from a $156.6 million profit a year earlier.
A securities class action has been filed against BitGo Holdings Inc. alleging the company misled investors about its exposure to digital asset price declines. BTGO shares lost more than 57% from their $18 IPO price after the crypto custodian reported a $14.8 million net loss for 2025, swinging from a $156.6 million profit a year earlier.
A class action lawsuit hit BitGo Holdings Inc. on July 23, alleging the crypto custodian misled investors about its vulnerability to digital asset price declines.
"Investors deserve transparency about material risks that could affect their investments," Joseph E. Levi, managing partner at Levi & Korsinsky LLP, said. "When consistent reassurances about business fundamentals effectively override cautionary language, shareholders may be left without the information they need to make informed decisions."
The lawsuit, filed in the US District Court for the Eastern District of New York, covers investors who bought BTGO shares in the company's January 2026 IPO or between Jan. 22, 2025 and May 13, 2026. BitGo sold 11.8 million shares at $18 each in its IPO, raising $187.6 million. The stock closed at $7.67 on March 27 after the company reported a $14.8 million net loss for 2025, compared with $156.6 million in net income in 2024. Digital Asset Sales margins fell to 0.21% from 0.47% a year earlier. The shares fell another 17% on May 14 after BitGo posted a $60.7 million net loss for the first quarter of 2026.
The complaint alleges BitGo's offering documents and public statements repeatedly described the company's business fundamentals as "strong and resilient," effectively negating risk-factor warnings about the impact of digital asset price volatility on its percentage-based fee model. Staking revenue fell 16% year over year for 2025 and 64% in the fourth quarter alone, according to the filing.
Three law firms — Robbins LLP, Levi & Korsinsky LLP, and Bernstein Liebhard LLP — have announced the class action, which seeks damages for investors who purchased shares during the class period. The court has set Aug. 7, 2026 as the deadline for investors to apply for lead plaintiff appointment.
The lawsuit adds legal risk to a stock that has already lost more than half its value since going public. Investors will watch for any settlement announcements or additional disclosures from BitGo as the case proceeds through the Eastern District of New York.
This article is for informational purposes only and does not constitute investment advice.
