Argo Blockchain Accused Of Misleading IPO Investors, Faces Trial

Argo, the debt-ridden blockchain, has been the subject of a class action lawsuit for allegedly misleading investors during its initial public offering (IPO) in 2021. The lawsuit comes as Argo’s share price blockchain has dropped 98% in recent days. . At the time of the IPO, Argo had offered its shares at the price of $15 (approximately Rs. 1,222) and now its price stands at $0.2 (approximately Rs. 16). This marks a 98% decline in its stock price.

The Argo blockchain had generated around $105 million (roughly Rs. 856 crore) at the time of its IPO. Argo had released 7.5 million ADS tokens, with each token costing $15 (around Rs 1,222).

In a lawsuit, early investors in the Argo blockchain said the developers behind the platform hid important information from them, such as its fight against rising electricity charges.

“The offering documents were negligently prepared and accordingly contained misrepresentations of material facts or failed to state other facts necessary to ensure that the statements made were not misleading and were not prepared in accordance to the rules and regulations governing their preparation,” the filing said.

In December last year, Argo Blockchain announced the sale of its mining facility, based in Texas’ Dickens County, for $65 million (roughly Rs. 540 crore).

The mining company will use the funds from this sale to initiate and complete repayments of pending loans.

Over the past seven months, the global crypto industry has lost over $200 billion (roughly Rs. 16,32,270 crore) due to market volatility, low investor risk appetite, hacks , as well as failures of promising projects.

As several crypto-related businesses have filed for bankruptcy or laid off staff, the crypto mining industry has also suffered badly.

According to a Bloomberg report, Bitcoin miners lost over $1 billion (about Rs 8,200 crore) in the recent crypto crash.

For now, the conduct of this trial is scheduled for the coming weeks.

Argo blockchain has not yet commented on the subject.