New York Court Blocks Genius Group from Raising Funds and Purchasing Bitcoin

Highlights:

• A court order freezes Genius Group’s ability to sell shares, raise funds, or buy Bitcoin.
• Genius Group sells Bitcoin holdings, reducing treasury from 440 BTC to 430 BTC.
• Company files emergency appeal, challenging the injunction, and seeks to overturn ruling.​

On March 13, the United States District Court for the Southern District of New York issued a preliminary injunction (PI) and temporary restraining order (TRO) against Singapore-based artificial intelligence firm Genius Group. This order prevents the company from selling shares, raising funds, or using investor money to purchase Bitcoin. As a result, Genius Group is now selling part of its Bitcoin holdings to keep operations running.

Advertisement

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

Court Blocks Genius Group from Raising Funds and Selling Shares

The court’s ruling is connected to an ongoing legal dispute involving Genius Group, an education and AI-focused company. Fatbrain AI and Genius Group completed a merger and purchase agreement in March last year. By October 30, Genius Group started arbitration to terminate the deal. 

In December, both companies agreed to a temporary court order. The situation got worse when Fatbrain AI shareholders sued the company and its leaders, Michael Moe and Peter Ritz, for fraud. The SEC also filed shareholder fraud allegations against Fatbrain AI. On February 14, Moe and Ritz sought a temporary restraining order and preliminary injunction. The goal was to stop Genius Group from selling shares or using its $150 million ATM funds to buy Bitcoin.

The court granted the injunction on March 13. This froze Genius Group’s ability to issue shares or raise funds. In response, Genius filed multiple motions. They argued that the injunction disrupts the status quo and was based on false claims. The company submitted a transcript of a meeting with Ritz, recorded on February 27. Ritz allegedly discussed exploiting the legal process to extract money.

Genius Group Sell Bitcoin Holdings

Due to the court order, Genius sold part of its Bitcoin holdings. Its treasury decreased from 440 BTC to 430 BTC. The company warned that more sales may happen if the injunction stays. It also can’t give share-based pay to employees, breaking Singaporean laws. The company filed an emergency appeal with the U.S. Court of Appeals to cancel the injunction.

The company is cutting costs by reducing marketing, closing divisions, and canceling event sponsorships. Roger James Hamilton, the CEO, expressed concern. He mentioned that they did not expect a U.S. court to block decisions like share issuance, fund-raising, or Bitcoin purchases. He believes these decisions should be made by shareholders or the board.

The court order affected the company’s stock. Genius Group stated that its share price dropped 53% since the restraining order. The market capitalization is now 40% of its Bitcoin Treasury value.

 The firm said:

“Genius is taking all necessary measures to minimize Bitcoin sales but anticipates that it will need to downsize its Bitcoin Treasury in the coming months in the event the PI remains in place.”

Advertisement