Genius Group has been ordered by a U.S. court to sell its Bitcoin holdings, which comes after a decision blocking the company's financial transactions.

This injunction is tied to a dispute over Genius Group's merger with Fatbrain AI, finalized in March 2024, after which Genius initiated arbitration in October 2024, alleging fraud by Fatbrain executives.

In February 2025, Fatbrain AI executives sought a restraining order to prevent Genius Group from engaging in further financial activities, including Bitcoin purchases, during the arbitration process.

CEO Roger James Hamilton has expressed concerns regarding the U.S. court's authority to restrict corporate actions that are typically governed by shareholders or the board.

He also voiced frustration over the legal actions against the company, arguing that they contradict the interests of shareholders and the board.

Additionally, the SEC has filed allegations of shareholder fraud against Genius Group, further complicating its legal challenges.

Despite these setbacks, Genius Group remains committed to its Bitcoin-first strategy, which it adopted in November 2024.

The company's stock has dramatically declined, plummeting over 99% from a peak of $96 in June 2022 to approximately $0.23.

This legal situation raises concerns for other companies holding Bitcoin, highlighting the potential risks associated with Bitcoin investments despite a generally pro-crypto stance from the current U.S. SEC leadership.

In response to the court's decision, Genius Group plans to appeal the preliminary injunction at the U.S. Court of Appeals for the Second Circuit.

Currently, Genius Group's market capitalization is only 40% of the value of its Bitcoin Treasury, indicating significant financial distress.

Hamilton reaffirmed the company's commitment to Bitcoin, emphasizing its role in ensuring transparency and preventing fraud, even as they are forced to sell some of their holdings.