Key takeout
The Genius Group is being forced to sell Bitcoin as a US court order prevents financial action. The market value of the Genius Group has declined significantly since the court order was issued.
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Genius Group, an AI-powered education company, announced today that Bitcoin Holdings must be sold after a US court order prevented the company from selling its shares, raising funds and purchasing Bitcoin.
The Genius Group was forced to reduce Bitcoin Holdings from 440 to 430 Bitcoin following a preliminary injunction granted by the US District Court Southern District on March 13.
The court’s order arises in continuing legal proceedings between the genius group and the parties involved in Fat Brain AI.
The Genius Group began arbitration in October 2024 to terminate its Asset Purchase Agreement (APA) with Fatbrain AI. In December, the companies agreed to a temporary injunction relating to the contract.
Things escalated when Fatbrain AI shareholders filed lawsuits against the company and its executives Michael Moe and Peter Ritz, alleging fraud in connection with the APA. The SEC also brought about shareholder fraud allegations against the company.
In response, Moe and Ritz blocked the genius group from selling stocks, raising funds or purchasing Bitcoin in search of a temporary restraining order (TRO) and subsequent interim injunctions (PI). The court granted both orders.
“We didn’t dream of a U.S. court to prevent a company from issuing shares, raising funds, or purchasing Bitcoin, all measures normally determined by shareholders or boards of directors of a public company, not courts.
Due to funding restrictions, Genius Group has downsized, closed its division and suspended sponsorship, marketing and investment. The company said it has already sold 10 Bitcoins to fund its business.
The court’s order also affected the company’s stock performance. The Genius Group’s share price has fallen 53% since the suppression order was issued, and its market capitalization is now 40% of the Bitcoin Treasury value.
The Genius Group is pursuing an appeal with the U.S. Court of Appeals in the Second Circuit, aiming to vacate PIs.
The AI ​​education company began adopting the “Bitcoin First” strategy in November 2024, moving to holding Bitcoin as a major Treasury reserve asset with a target of $120 million.
Despite being forced to sell some Bitcoin, Genius Group reaffirms its belief in Bitcoin.
“We will also continue to raise the Bitcoin flag even if we legally prohibit the construction of Bitcoin’s Treasury Department. We believe that Bitcoin will ensure transparency and will prevent the exact types of wire fraud and shareholder fraud that are the subject of current lawsuits,” Hamilton said.
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