DeFi Technologies Navigates Legal Challenges Amid South American Expansion

DeFi Technologies CA24464X1069

While DeFi Technologies announces a significant strategic advance in Brazil, investor sentiment remains clouded by a surge of legal action in the United States. The company finds itself at a crossroads, balancing operational growth against mounting legal pressures that threaten to undermine market confidence.

The current climate of uncertainty traces back to mid-November. On November 14, DeFi Technologies reported third-quarter revenue of approximately $22.5 million, a figure that fell short of market expectations. Concurrently, the company revised its full-year 2025 forecast downward, triggering a sharp decline in its share price.

Amid this turbulence, a leadership transition was executed. Johan Wattenström assumed the role of CEO from Olivier Roussy Newton on November 17. Although Wattenström, as a co-founder of Valour, brings relevant expertise for the firm's product expansion, the timing of the change—alongside the revised guidance—contributed to further investor unease. The stock has since traded with volatility around recent lows near $1.20.

A Wave of US Class Actions Intensifies Scrutiny

This operational backdrop is now compounded by serious legal headwinds. Multiple U.S. law firms, including Johnson Fistel and Bernstein Liebhard, have filed class action lawsuits against the company. The allegations center on potentially misleading statements made by management between May and November 2025.

Specifically, the company stands accused of failing to disclose operational difficulties with its core DeFi arbitrage strategy and increasing competitive pressures. These factors are cited as primary reasons behind the necessary revision of the 2025 revenue outlook. Investors have until January 30, 2026, to apply as lead plaintiffs in the consolidated proceeding.

Brazilian Market Entry Provides a Counterpoint

Against this challenging landscape, a key operational milestone offers a contrasting narrative. The company's subsidiary, Valour Inc., has received approval from the Brazilian exchange B3 to list four new Exchange Traded Products (ETPs). These products, tracking Bitcoin, Ethereum, Ripple, and Sui, are scheduled to begin trading on December 17.

This move represents a strategic entry into one of the world's most significant digital asset markets. The initiative aims to diversify revenue streams beyond the European market, a step viewed as crucial for stabilizing long-term growth.

The coming weeks present a critical test for DeFi Technologies. The December 17 launch in Brazil must deliver tangible operational momentum, while developments on the legal front will be closely monitored by the market. The company's ability to manage this dual reality of expansion and litigation will likely determine its near-term trajectory.