Back to the list

Coinbase Faces New Lawsuit over Alleged Bitcoin Cash (BCH) Insider Trading


cryptovest.com 23 November 2018 19:50, UTC
Reading time: ~2 m

American cryptocurrency market Coinbase has been again accused of Bitcoin Cash (BCH) insider trading by several of its clients, according to a lawsuit from Tuesday. The new allegations are made by seven plaintiffs including Jeffery Berk, a San Francisco citizen, who filed similar charges against the company earlier this year.

A Californian judge dismissed the Berk’s accusations last month, as he was unable to prove the “the scope or content of Coinbase duty.” In the new filing, Berk and counterparts are claiming that the trading venue had breached its own listing rules, which allowed people from Coinbase staff to make substantial trading profits. The plaintiffs are explaining that Coinbase intentionally caused the extreme BCH spike sudden crash by listing BCH without enough preparational time.

In December 2017, the exchange announced support for Bitcoin Cash and let people who cashed into BTC to benefit from a BCH airdrop. According to Berk, insiders had prior information and had been able to take BCH trading positions before official listing. Then shortly after adding the coin to its roster, Coinbase allegedly shut down selling services due to BCH’s abnormal price jump and allowed only buying, which benefited the people with prepared positions.

“The sudden launch (of BCH) was effectively part of an attack by Coinbase and (CEO Brian Armstrong) to depress the price of BTC and to inflate the price of BCH, to encourage more transactions and greater profitability for Coinbase,” the new lawsuit reads.

Coinbase can respond to the accusations until December 20. The US Court for the Northern District of California will hold a hearing on January 31 next year, when the judge should decide to allow or to dismiss the lawsuit.

Earlier this year, Coinbase conducted an internal investigation, which did not find any wrongdoings.

Back to the list