Multiple Lawsuits Target Crypto Exchange Coinbase
Elevated scrutiny from the regulatory agencies is now targeting Coinbase, while the platform is presently subject to several lawsuits. The crypto exchange, which is based in San Francisco, is currently being examined on the behalf of the U.S. Securities and Exchange Commission (SEC). Simultaneous to this, 2 extra-legal suits have also been submitted by the law firms against Coinbase.
Coinbase Gets Deeper in Regulatory Trouble
Bragar Eagel & Squire (a law firm based in New York) stated on Thursday to sue the crypto exchange as it has made false assertions regarding the business activities done by it. The second lawsuit has been filed by Pomerantz LLP accusing that Coinbase should compensate for the losses resulting from the violations done by the exchange against the federal laws regarding securities. The respective lawsuit’s objective is to get the plaintiffs compensated.
Both of the claims brought to the front that deceptive and fraudulent representations dealing with its business, compliance endeavors, and operations between 14th April of the recent year and 26th July of the current year. As the complaints mention, it was not disclosed by the crypto exchange that it kept the crypto assets of users in escrow, to face the bankruptcy proceedings where the consumers’ position would be that of unsecured creditors.
Increasing Number of Cases Endangers Coinbase’s Reputation
In addition to this, it has been reported that the exchange denied revealing to have allowed the Unite States-based people to perform digital asset trading in which there was a requirement of being registered under the securities regulator for offering the securities. In this way, the lawsuits put forth that the public representations of Coinbase were to a great extent deceptive hence leading to the filing of these legal cases.
Other such court cases have also been faced by Coinbase in recent times. These 2 unique lawsuits have been witnessed at a time when the securities regulator of the United States is keenly observing the crypto exchange as well as investigating it for the accused trading of unregistered securities.
Apart from this, Ishan Wahi (the person who served as the global product manager at Coinbase formerly) has been charged with insider trading that is to be discussed in another court case. previously this month, the person was found guilty of wire-fraud conspiracy.
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