Coinbase scrutiny intensifies as major US cryptocurrency exchange is hit by two new lawsuits

The largest cryptocurrency market in the United States is facing a new round of legal challenges after several lawsuits.

Coinbase is facing two class action lawsuits in the wake of the US Securities and Exchange Commission (SEC) reviewing an unregistered stock exchange as a former chief product officer pleads not guilty to insider trading in federal court.

In the first case, the law firm Bragar Eagel & Squire filed a lawsuit against Coinbase Global in the US District Court of New Jersey on behalf of investors who purchased shares of Nasdaq COIN between April 14, 2021 and July 26, 2022.

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In question, there are two cases where the price of a security fell after bad news for Coinbase was published:

  • It was revealed on May 10 that in the event Coinbase declares bankruptcy, the digital assets of clients held on the company’s exchange “may be subject to bankruptcy proceedings and such clients may be treated as unpaid creditors.” General guarantees.” COIN continued to decline by 26.4%.
  • A July 25 report that the US Securities and Exchange Commission (SEC) was investigating Coinbase over allegations that the exchange was selling unregistered securities on its market. COIN stock lost more than 21% of its value the next day.

More information on the Bragar Eagel & Squire complaint can be found here.

The second class action lawsuit against Coinbase Global and some of its executives has also been filed in the United States Universal District Court for the District of New Jersey by Pomerantz LLP.

The Company seeks to recover damages for defendants’ violations of federal securities laws and pursue remedies [applicable under] The Securities Act of 1934″.

Pomerantz’s lawsuit includes quasi-literal allegations against Coinbase in connection with bankruptcy clauses and an ongoing investigation with the SEC.

“The complaint alleges that throughout the course of the lawsuit, the defendants made false and materially misleading statements regarding the company’s business, operations, and compliance policies.

…the above behavior has exposed the company to increased risks from regulatory and government scrutiny and enforcement action.

…the Company’s public statements have been materially false and misleading at all relevant times.

Details of the case will be added soon to the Pomerantz website.

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