Coinbase Faces New Insider Trading Lawsuit

Coinbase may be heading to court again after a new class action lawsuit was filed against the firm by traders in the US District Court for the Northern District of California on Tuesday.

In their filing, the plaintiffs argue that the cryptocurrency exchange “made false and deceptive statements” regarding the Bitcoin fork to Bitcoin Bitcoin While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that While some may still be wondering what is Bitcoin, who created Bitcoin, or how does Bitcoin work, one thing is certain: Bitcoin has changed the world.No one can remain indifferent to this revolutionary, decentralized, digital asset nor to its blockchain technology.In fact, we’ve gone a long way ever since a Florida resident Laszlo Hanyecz made BTC’s first official commercial transaction with a real company by trading 10,000 Bitcoins for 2 pizzas at his local Papa John’s.One could now argue that Read this Term Cash in August of 2017.

They allege that the exchange caused the price of Bitcoin Cash to spike and then crash, enabling insiders to rake in serious profits.

Concurrently, the plaintiffs allege that Coinbase insiders, who knew that the exchange would list Bitcoin Cash, were able to start buying the cryptocurrency before the exchange’s customers were.

More specifically, the exchange allegedly allowed those insiders to take positions in Bitcoin Cash, then opened up the market to the public which pushed the price up.

Coinbase - Pump and Dump?

Once the price had been inflated to a certain level, Coinbase allegedly shut down trading for Bitcoin Cash - except for those individuals that had taken positions in the cryptocurrency prior to its going live on the exchange.

Moreover, when the exchange did launch Bitcoin Cash, only buy orders were available - that made it impossible for everyone, except those permitted to do so by the exchange, to sell the cryptocurrency.

Coinbase may respond to the allegations made in the class action lawsuit by the 20 of December 2018. A hearing has also been set for January 31 of next year.

The new class action lawsuit comes a month after another case against Coinbase, regarding the same Bitcoin Fork Fork A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software th A fork can occur when a blockchain diverges into two potential paths forward, there is a change in protocol, or a scenario occurs in which two or more blocks have the same block height.Because blockchain networks are decentralized, the participants on the network must come to an agreement when it comes to things like software upgrades to a network. This is called consensus.When consensus cannot be achieved on a software upgrade, a fork occurs, effectively representing a divergence in software th Read this Term, was dismissed by a judge.

Much like the class action lawsuit filed this week, former customer Jeffrey Berk, representing a number of different investors, said that the exchange had tipped off insiders to the Bitcoin Cash launch prior to it being announced publicly.

Judge Vince Chhabria said that Berk did not clarify how Coinbase could have better performed the Bitcoin Cash launch.