BitGo faces securities probe after 38.7% revenue decline triggers 17% selloff

Rosen Law Firm is investigating BitGo Holdings for potential securities claims after the crypto platform's first-quarter revenue fell 38.7%, the firm said Thursday.

The investigation follows BitGo's May 13 disclosure that total revenue declined 38.7%, reflecting a weaker crypto market environment and lower digital asset sales revenue from a shift in client activity from spot trading to derivatives products, the company said in an 8-K filing with the Securities and Exchange Commission.

BitGo's stock fell $2.05, or 17.2%, to close at $9.86 on May 14, the day after the filing. The Rosen Law Firm said it is preparing a class action seeking recovery of investor losses on behalf of BitGo shareholders, alleging the company may have issued materially misleading business information to the investing public.

The probe adds legal risk to a company already navigating a deteriorating crypto trading environment. BitGo launched its derivatives offering at the beginning of the first quarter, which the company said contributed to the shift in client activity away from its spot trading business. Investors will watch for any subsequent regulatory filings or class action certification deadlines that could determine the scope of potential liability.

This article is for informational purposes only and does not constitute investment advice.