Coinbase Customers Reject Efforts to Shift Complaints to Arbitration
Customers who filed a class-action suit against Coinbase turned down the attempts by the crypto firm to shift the case to an arbitrator. The aggrieved customers allege negligence in Coinbase to avert cybersecurity failures. They claim fault in the crypto firm to secure the accounts from the breach. As such, they admit to incurring losses since the exploiter initiated the unauthorized transfer of crypto assets.
Coinbase Accused of Misrepresentation and Dishonesty
The plaintiffs’ attorney dismissed Coinbase’s recent emphasis on limiting cases settlement to arbitrators. Instead, the customer seeks to pursue the case before the federal court for Coinbase to compensate for the losses incurred. The documents filed before the District Court in Northern Georgia indicate that one victim discovered the exploiter drained $6000 cryptos from the wallet.
He added that the hacker moved the proceeds to an unknown wallet. The filing reveals that the crypto firm allowed the hacker to access and withdraw another $1000.
The plaintiff discloses that while his bank reversed the amount, Coinbase froze the account. In addition, the crypto firm imposed a penalty resulting in a negative balance. He submits that Coinbase would later claim and recover the $1000 initially stolen by the hackers.
The lawsuit accuses Coinbase of misrepresentation and dishonesty contrary to its assertions of deploying standard safeguards to secure users’ accounts.
The plaintiffs’ attorney submitted that Coinbase has repeatedly denied the consumers access to their funds. The filings portray Coinbase conduct as improper and unreasonable to limit or permanently suspend access to the accounts.
Users Dismiss Dispute Resolution through Arbitration
The plaintiffs’ attorney filed a motion to counter Coinbase’s submission to utilize alternative dispute resolution. The attorney indicated that the crypto firm often imposes cumbersome conditions aggrieved parties must fulfill to reach arbitration. The plaintiffs portrayed the firm as systematically dishonoring its user agreement during dispute resolution.
The plaintiffs admit that settling disputes by arbitration often attracts lower fees than placing proceedings before the federal courts. Nonetheless, they held that arbitration suffers from declined transparency and often applies varying standards for evidence.
Avoid Making Arbitration Compulsory
The efforts by Coinbase to limit dispute resolution to the arbitrators had yielded mixed success. In December, the US appellate judges directed Coinbase to avoid compelling customers aggrieved during the Dogecoin sweepstakes run to consider private arbitration.
The suit arose from the promotional campaign Coinbase ran in June 2021, offering users an opportunity to win $1.2 million of the Doge. Such directives dent Coinbase’s reputation as the stock has declined by 90% to exchange at $32.40.
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