U.S Court drops Coinbase Bitcoin Cash Lawsuit

According to a rumour by Ran Neuner (CNBC Crypto Trader) that Coinbase will soon announce its initial public offering, the U.S. based crypto exchange received some positive news relating to its accusation over insider trading that happened in 2017.

Bitcoin Cash, In August 2017 made its official hard fork from the original Bitcoin source code. For investors who kept their coins on exchanges such as Coinbase, the air drop of forked coins was not made immediately available. However, investors were promised by Coinbase that by the end of the year, BCH would be supported by the exchange, which included the coins that were due at the time of the fork. However, Coinbase didn’t give a specific date for the addition of the currency to the exchange–for reasons linked to a pump and dump–and lacked a clear protocol for adding new currencies.

Bitcoin Cash (BCH) Price Today – BCH / USD

Name Price24H (%)
Bitcoin (BTC)
$7,318.41
-2.43%
Bitcoin Cash (BCH)
$207.35
-2.52%

In the interim, cryptocurrency experienced a massive bull run that led to an increase in the total market cap from around $200 billion to over $800 billion. Furthermore, a lot of new investors started making use of Coinbase which outpaced exchange resources, that at a time was reported to have over 13 million customers. The combination of the rushing in of new investors, overexposure to cryptocurrency, and the bullish fever that overtook the markets led to Bitcoin Cash listing on the exchange in the final weeks of December 2017.

Although Coinbase has maintained that Bitcoin Cash’s price pump for was just a coincidence, a lot of investors have complained over the way the issue was handled. For one, the listing of Bitcoin Cash led to the sudden end to the bullish run in BTC value, as investors switch sides to enjoy the pumping price of BCH. In addition, the great increase in BCH value in the day leading up to the exchange listing point can be attributed to some form of insider knowledge, either by the Coinbase employees hoping to capitalize on their insight into the company’s actions, or colleagues of Coinbase employees who were tipped off before the listing took place.

In an internal review, which was conducted throughout this year and released in July, Coinbase claims that during the Bitcoin Cash listing, no insider trading took place, stating that there was no instance where employees or their acquaintances unfairly benefitted from the news. With reference to documents published by the Vince Chhabria, U.S. District Judge from the Northern District Court of California on Oct. 23, has agreed with the exchange by throwing out a case accusing the exchange of insider trading.

The motion revealed that, plaintiff Jeffrey Berk of Arizona did “not sufficiently articulate the legal bases for his claims” in the lawsuit, which led the Judge to dismiss the case ahead of going to trial. “Berk fails to describe the scope or content of Coinbase’s duty in anything more than broad generalities. A reader of the Complaint is thus left wondering what Coinbase should have done differently, or why the rollout of Bitcoin Cash would have gone more smoothly had Coinbase done whatever Berk thinks is appropriate.”

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