DeFi Technologies Faces Legal and Strategic Crossroads

DeFi Technologies enters the new year navigating a complex landscape of legal challenges and strategic ambitions. As markets remain closed for a holiday, the company contends with mounting legal pressure while its leadership simultaneously promotes an aggressive growth blueprint for 2026, underpinned by what it describes as a robust financial position.

The legal situation intensified as multiple law firms, including Faruqi & Faruqi, LLP and Bronstein, Gewirtz & Grossman, LLC, issued fresh notices to investors regarding an ongoing class action. This federal securities class action allows shareholders to apply for the role of Lead Plaintiff until January 30.

The lawsuits allege that DeFi Technologies and certain executives violated U.S. securities laws. Central to the claims are statements concerning the "DeFi Alpha" arbitrage strategy, a key component of the company's revenue model. The plaintiffs' allegations include:

• Undisclosed Implementation Delays: A failure to properly disclose setbacks in executing the DeFi arbitrage strategy.
• Minimized Competitive Threats: An alleged downplaying of competitive pressures from other Digital Asset Treasury (DAT) providers.
• Significant Forecast Reduction: A subsequent, substantial cut to the fiscal 2025 revenue forecast from $218.6 million to approximately $116.6 million.

These legal actions were triggered by the market's reaction to third-quarter 2025 results, released in November. That report revealed a revenue decline of nearly 20%, falling short of market expectations.

Financial Position and Share Price Volatility

The recent trading activity of DeFi Technologies' stock reflects the tension within its business narrative. Following the sharp downward revision of its revenue guidance in November, the shares experienced significant volatility. By late December 2025, the stock was trading in a range of $0.74 to $0.82, well below its 52-week highs.

Market observers are carefully weighing the company's legal risks against its financial resources. Management highlights a $100 million capital raise completed in 2025 and a debt-free balance sheet. However, the sharply reduced 2025 revenue target remains a critical point of concern, as it exposes execution difficulties within the highly competitive digital asset arbitrage sector.

Should investors sell immediately? Or is it worth buying DeFi Technologies?

The 2026 Expansion Strategy

Amidst these legal headwinds, the company's management is actively steering the narrative toward future growth. In a year-end letter to shareholders released just before the new year, CEO Johan Wattenström outlined the strategic focus for 2026 and emphasized the company's financial footing.

Key elements of this forward-looking plan are:

• Strong Liquidity: As of the end of Q3 2025, the company held $165.7 million in cash, cash equivalents, and digital asset treasury holdings.
• Expanded Product Suite: Its subsidiary, Valour, has broadened its offering to 102 exchange-traded products (ETPs).
• Wider Market Access: The company's products are now listed on several exchanges, including the London Stock Exchange, the SIX Swiss Exchange, and Brazil's B3.
• New Business Line: The planned launch of "Valour Custody" as a standalone division in 2026, aiming to provide services to external clients.

This strategy represents a concerted effort to shift investor focus from near-term operational issues to long-term expansion opportunities.

A Dual Challenge for Shareholders

Investors currently face a dual narrative. On one side, the class action lawsuit—with its January 30 deadline for Lead Plaintiff applications—keeps allegations regarding transparency and governance shortcomings in the spotlight. On the other side, DeFi Technologies is leveraging its substantial liquidity reserves to expand its regulated asset management business internationally and establish a new custody segment.

The trajectory for the coming year will likely be determined by two factors: the evolution of the legal proceedings, and the company's ability to execute its expansion and custody plans on schedule, without further negative surprises.