Bitfarms ousted its CEO Geoffrey Morphy on May 13 after he filed a $27 million lawsuit against the company.
According to a press release from the Bitcoin miner, Morphy filed a multi-million dollar claim in the Superior Court of Ontario on Friday alleging damages caused by Bitfarms related to breach of contract, wrongful dismissal, and aggravated and punitive damages worth $27 million.
Bitfarms Fires Morphy After $27 Million Lawsuit
Bitfarms Chairman and co-founder Nicolas Bonta has been appointed interim President and CEO of Bitfarms.
The bitcoin mining company’s shares were trading 5.9% lower as of early Monday afternoon.
Latest update on Bitfarms $BITF CEO news for anyone holding 👇
I previously said optics matter and that the CEO fiasco at this point of the #bitcoin cycle was VERY strange, a bad look, and a likely result of a fallout among management. This is now confirmed.
To make optics… pic.twitter.com/LgnKRhnyeT
— Danny Marques | Investing Informant 📊📈 (@Invst_Informant) May 13, 2024
“The company believes the claims are without merit and intends to defend itself vigorously,” Bitfarms said.
In addition to news of Morphy’s sudden exit, Bitfarms also announced Monday that it would push its first quarter conference call to Wednesday morning at 8 a.m.
The Start Of A Legal Battle Between Crypto Geoffrey Morphy And Bitfarms?
Bitfarms originally announced Morphy’s transition to leave the Toronto-based in March, stating he would leave “upon completion of an executive search” for his replacement.
After Bitfarms was founded in 2017, Morphy joined its management team in 2020 before rising to the role of CEO in late 2022.
“It has been the greatest privilege of my career to serve Bitfarms, our shareholders, and our employees,” Morphy said in a statement at the time. “I am extremely proud of what we’ve accomplished as a team.”
Issues between the now-ousted CEO and Bitfarms have clearly risen to the surface, however, despite Bonta recently referring to Morphy as “an integral part of the company’s success.”
Bitfarms To Announce CEO Replacement In Coming Weeks
The CEO’s departure comes during a difficult time for crypto miners, with public mining companies reporting Bitcoin production decreases following April’s quadrennial halving event
Miners have struggled in the halving’s aftermath as mining rewards were reduced from 6.25 BTC to 3.125 BTC.
Markus Thielen, Head Researcher at 10x Research, warned in an April 2024 note that a summer lull in the crypto market could see miners sell off a big portion of their holdings and “potentially liquidate $5 billion worth of BTC.”
“The overhang from this selling could last four to six months, explaining why Bitcoin might go sideways for the next few months—as it has done following past halvings,” Thielen said.
Meanwhile, Bitfarms said that the search for its next CEO is “nearing completion,” with a replacement scheduled to be announced in the next weeks.