San Francisco District Court judge Vince Chhabria ruled that the latter showed negligence and “clear incompetence generated by haste” when it started trading in Bitcoin Cash (BCH) on Coinbase. Now Coinbase, apparently, will be forced to stand trial, Bloomberg reports.
So, at the end of 2017, the exchange opened BCH trading, but was forced to suspend operations after 2 minutes due to high volatility and suspicious price increases - the coin began to grow rapidly several hours before the announcement of Coinbase.
Then the company was accused of insider trading, later crypto enthusiasts even began to find confirmation of this.
According to the judge, the users who bought VSN at inflated prices were primarily affected. He noted that the suspension of trading was too hasty and disrupted the normal functioning of the market.
BCH buyers claim that Coinbase could have announced a bid in advance to prevent a price spike, but it did not. The judge agreed with this opinion and noted that shortly before the launch of BCH trading on Coinbase, the Chicago Mercantile Exchange opened trading in bitcoin futures, which could become a factor of too much market participants' recovery.
According to the publication, Coinbase has not yet commented on the court decision.
Recall that in March 2018, a class action lawsuit was filed against the company, in which Coinbase was accused of “artificially overpricing” Bitcoin Cash through trading based on insider data.