Semler Scientific Plans $29.75M DOJ Settlement Using Bitcoin-Backed Loan

Healthcare tech company Semler Scientific has announced a tentative $29.75 million settlement with the U.S. Department of Justice (DOJ) over alleged violations of a federal anti-fraud law related to its flagship product, QuantaFlo. According to a Tuesday filing with the Securities and Exchange Commission (SEC), the company disclosed it has been under investigation since 2017, when it received a civil investigative demand (CID). Since then, Semler has complied with multiple subpoenas and began initial settlement talks with the DOJ in February.

To fund the proposed settlement, Semler Scientific plans to borrow under a newly signed master loan agreement with crypto exchange Coinbase. The loan will be backed by its significant bitcoin holdings, which currently stand at 3,192 BTC, worth approximately $267 million at current prices. The company noted it would combine proceeds from this crypto-collateralized loan with existing cash reserves to cover the settlement payment.

Semler clarified that the investigation is not related to its bitcoin investments. However, the settlement remains provisional. If a final agreement cannot be reached, the DOJ may still pursue legal action seeking damages greater than the proposed settlement. In that case, the company stated it would "vigorously defend itself."

The agreement highlights Semler Scientific’s unique financial strategy, leveraging its digital asset portfolio to address legal liabilities. As one of the largest publicly known corporate bitcoin holders, the company’s use of crypto-backed loans may set a precedent for similar firms navigating regulatory or legal challenges while managing digital assets.