Legal trouble may be in Coinbase’s future, at least in the short term. Being one of the most influential and widely used cryptocurrency exchanges at a global scale, every decision it makes and steps it takes are closely watched and scrutinized, and according to a judge, the platform may be facing trouble because of past irregularities while listing Bitcoin Cash (BCH).
A judge recently ruled that Coinbase needs to go to court because of the management of BCH’s listing during the 2017’s market bull run, a moment in which Bitcoin and virtually all the top 20-ranked coins, including Bitcoin Cash, reached their all-time highs in value.
Its Finest Moment
During the late 2017 – early 2018 market surge, Bitcoin reached its highest value yet, briefly surpassing the $20,000 barrier. At that moment, the world’s interest in crypto assets began to soar, as well, but a subsequent correction was in the cards for the upcoming months.
It is clear, then, that the world’s attention began to shift its focus towards Bitcoin and other cryptocurrencies thanks to the late 2017 run. However, legal instances are now accusing Coinbase of trying to take advantage of the situation.
According to a report from a famous crypto news site, the renowned exchange must face a controversial lawsuit for negligence from investors who acquired BCH holdings after the supposedly mishandled listing on the platform in the mentioned period.
Was There Market Manipulation?
According to the story, U.S. District Judge Vince Chhabaria of the Northern District of California refused to consider the claims of unfair competition and fraud made by the plaintiffs against the exchange, while doing the same with the allegations of negligence brought up by those that sold BCH assets.
However, the judge also rejected petitions from Coinbase to move the case to arbitration and to completely ignore the allegations of negligence made by those who acquired the crypto assets, instead of recognizing the possibility of the American platform incurring in a breach of failure to keep a fair and functional market.
Owning Up And Facing Responsibilities
At that moment, Coinbase was, arguably, the unquestioned top crypto exchange, so it held (and holds) a huge responsibility towards the market and its customers. They took a controversial decision to list BCH and then, almost immediately, to stop trading, and some view that as manipulating market conditions.
After the series of events took place in 2017, numerous investors contacted courts and tried to get Coinbase to own up to their responsibilities. Some of the people that wanted to buy BCH during the famous bull run of 2017 ended up disappointed.