Lawsuit Against Coinbase to Details BCH Insider Trading

The plaintiffs argue that the exchange intentionally created the conditions for BCH pumps
22 November 2018   339

On Tuesday, November 20, a supplemented class action was filed with the federal district court of the Northern District of California against the largest US cryptocurrency company Coinbase, which contains data on the “false” statements of the latter when listing Bitcoin Cash in December 2017 and other details of probable insider trading, reported by CoinDesk.

The plaintiffs argue that the exchange intentionally created the conditions for Bitcoin Cash's pumps and allowed a limited number of traders to sell at the best price.

As a consequence of this scheme, the Individual Defendants and Coinbase enabled Coinbase to earn significant fees from the trades of its customers, from which Coinbase earned a spread over an inflated price for BCH, and to avoid a ‘run’ on the Company by sellers anxious to take advantage of the inflated price, by closing down trading within minutes of the Launch to all except certain insiders who were positioned to and did sell BCH at inflated prices during the Launch.
 

Lawsuit

Recall, against the background of listing on Coinbase, the BCH rate in just 48 hours took off by 130% - from $ 1,865 to $ 4,300. Trading was suspended already four minutes after the start.

Then, a Bitcoin enthusiast Albert Renshaw published a deleted correspondence on /r/Coinbase the day before the BCH listing, in which an unknown user mukiva2 warned traders about the upcoming event, citing a source in the company.

At the same time, the internal investigation of Coinbase found no evidence of insider trading, and at the end of October the Federal District Court of the Northern District of California rejected one of the lawsuits against the company [of March 2] due to the absence of legal grounds for its consideration.

Coinbase Capitalization to Exceed $8B

Another financial round, headed by  Tiger Global Management, brought $300M to the company
30 October 2018   283

The American cryptocurrency company Coinbase raised $ 300 million in the framework of a round of financing for the E Series, which was led by the American hedge fund Tiger Global Management. Y Combinator Continuity, Wellington Management, Andreessen Horowitz, Polychain and other companies took part in financial round too.

Thus, according to the company's estimates, its capitalization has already exceeded $ 8 billion, and the annual profit at the same time, according to Bloomberg, may be about $ 1.3 billion.

Coinbase intends to use funds for global expansion, expansion of listing, development of various utilitarian applications and attraction of institutional institutions to the industry.

Company became the first unicorn in the cryptocurrency sphere after the closing of the round of financing for the Serie D in August 2017.

Earlier in the media it was reported that Coinbase could enter the IPO after another investment.