Apollo Power, a company dealing with the development of solar energy through its daughter company SolarPaint, has reported to the Tel Aviv Stock Exchange that it is facing a class action lawsuit to the tune of 2.15 million NIS (622,360 USD), according to Israeli financial newspaper Globes.
The lawsuit is being brought by Eli Buchris, an investor in the company. According to the complaint, on the 18th of December at 09:19, just as the stock exchange was opening, the company reported a major breakthrough regarding Bitcoin mining – specifically, a “revolutionary” ability to power mining operations using solar power.
Bitcoin mining is so energy hungry that it is difficult for private miners to profit from it at all, and therefore the announcement was significant – as the plaintiff said: “It is therefore difficult to exaggerate the importance of the discovery announced by the company that morning.”
And indeed, the stocks behaved as one would expect after such a discovery. According to the plaintiff, the price of both Bitcoin and Etherium rose dramatically as a result of the announcement. The stocks of Apollo Power rose from 434.7 agorot (1.26 USD) to over 1,000 (2.89 USD).
However, only six hours later, Apollo Power stated that its report regarding the initial tests were misleading, and the ISA “forced” the company to release more details. The original statement claimed that users could make a significant additional income by way of the new technology, but in reality only 18 megawatts of electricity were produced – enough to mine 0.000054 Ethereum, or 0.004 USD. That works out to about 0.34 dollars a day.
Not only this – the amended report states: “Ethereum mining equipment added to the solar power system imposes additional costs, which are unknown at this stage.”
The investor claims in his lawsuit request that given these figures, Bitcoin cannot be profitably mined using this system. Thus, the company “seriously and blatantly tricked its investors by way of an immediately published report with missing and misleading details.”
Yesterday, the stock price of Apollo Power dropped by 7% to 290 agorot, meaning that is now worth around 30 million NIS. This is a 50% fall from its price on the 18th of December.