Bitfarms .(US:BITF) Prnewswireยท2025-05-12 17:39Core Viewpoint - A class action lawsuit has been filed against Bitfarms Ltd. and certain officers for alleged violations of federal securities laws during the Class Period from March 21, 2023, to December 9, 2024, seeking damages for misleading statements regarding the company's financial reporting and internal controls [1][6][8]. Company Overview - Bitfarms operates integrated Bitcoin data centers in Canada, the U.S., Paraguay, and Argentina, focusing on mining Bitcoin and managing digital assets [3]. - The company sells mined Bitcoin and accounts for the proceeds in its cash flow statement, which includes cash flow from operating, investing, and financing activities [4]. Financial Reporting Issues - In March 2024, Bitfarms identified a material weakness in its internal control over financial reporting related to the classification of 2021 Warrants, which should have been classified as financial liabilities rather than equity instruments [6]. - The company acknowledged that its internal controls were deficient, leading to misstatements in financial statements and the need for restatements [7][8]. Recent Developments - On December 9, 2024, Bitfarms announced that its consolidated financial statements for 2022 and 2023 contained a material error regarding the classification of proceeds from digital asset sales, which would need to be restated [8]. - Following this announcement, Bitfarms' stock price fell by $0.13 per share, or 6.07%, closing at $2.01 per share on December 10, 2024 [8]. - In its Annual Report on Form 40-F filed on April 1, 2025, Bitfarms reiterated its efforts to remediate the material weakness but indicated that the remediation plan would be completed in 2025, contrary to previous statements [9].