Singapore-based artificial intelligence company Genius Group has been temporarily barred from expanding its Bitcoin reserves following a U.S. court order.
The company announced on April 3 that a New York District Court issued a preliminary injunction (PI) and temporary restraining order (TRO) on March 13, restricting it from selling shares, raising capital, or using investor funds to purchase additional Bitcoin.
The court order stems from an ongoing legal dispute between Genius Group and Fatbrain AI, linked to a merger and purchase agreement the two firms finalized in March 2024.
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Genius Group Seeks to Terminate Merger, Alleges Fraud by Fatbrain AI Executives
By October 30, Genius Group initiated arbitration proceedings to terminate the merger, alleging fraudulent conduct by Fatbrain AI executives.
In response, Fatbrain AI executives Michael Moe and Peter Ritz filed for the TRO and injunction in February, effectively freezing Genius Group’s ability to expand its Bitcoin holdings and conduct routine corporate activities until the arbitration is resolved.
The restrictions have significantly impacted Genius Group’s operations. The company has closed business units, halted marketing efforts, and been forced to sell 10 Bitcoin from its treasury—previously consisting of 440 BTC valued at over $23 million.
Additional Bitcoin sales could follow if the injunction remains in place.
“Genius is taking all necessary measures to minimize Bitcoin sales,” the company said in its statement, adding that it may need to further downsize its treasury in the coming months.
The legal conflict has also led to further lawsuits.
Genius Group has been blocked by the US District Court Southern District of New York from selling shares or raising funds, and specifically banned from buying Bitcoin, in direct opposition to the wishes and approvals of the Company’s board and shareholders.
We will keep fighting… pic.twitter.com/Lk6uXzfCx6
— Roger James Hamilton (@rogerhamilton) April 3, 2025
In April 2024, shareholders of Fatbrain AI filed two lawsuits against both Genius Group and Fatbrain executives, accusing them of violating federal securities laws. However, Genius Group was voluntarily dismissed from these suits in February.
In a surprising turn, Genius Group claims the U.S. court order is causing it to breach Singaporean law by preventing it from issuing shares promised to employees as part of compensation agreements. CEO Roger James Hamilton expressed concern over the court’s authority.
“We never dreamed that it was possible that a U.S. court could block the company from being able to issue shares, raise funds or buy Bitcoin — all actions that would normally be decided by a public company’s shareholders or Board rather than a court.”
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Genius Group CEO Reaffirms Bitcoin Commitment Amid Legal Setbacks
Despite the legal hurdles, Hamilton affirmed the company’s commitment to Bitcoin, stating it will “continue to fly the flag for Bitcoin” even under current constraints.
Genius Group first began building its Bitcoin treasury in November 2024, acquiring 110 BTC for $10 million.
The company has publicly committed to holding 90% or more of its reserves in Bitcoin, targeting a $120 million treasury—a move that once sent its stock soaring by 66%.
However, shares have since plummeted, closing down nearly 10% to $0.23 and falling further after hours. From a peak of over $96 in June 2022, the stock has now lost more than 99% of its value.
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Key Takeaways
- A U.S. court order has temporarily barred Genius Group from expanding its Bitcoin holdings or raising funds.
- The restrictions stem from a legal dispute with Fatbrain AI over alleged fraud tied to a failed merger.
- Despite operational setbacks, Genius Group remains committed to its Bitcoin strategy.
The post U.S. Court Blocks Singapore’s Genius Group from Expanding Bitcoin Holdings appeared first on 99Bitcoins.
