American cryptocurrency exchange Coinbase did not find evidence of insider trading with Bitcoin Cash in December 2017. Anonymous sources informed Fortune that the company held a meeting last week, the topic of which was the results of an internal Coinbase Bitcoin cash investigation.
Coinbase Bitcoin Cash Investigation
According to representatives of Coinbase, an independent internal investigation, which was carried out by two legal companies, was completed.
Coinbase spokesperson said:
“We would not hesitate to terminate an employee or contractor and/or take appropriate legal action if evidence showed our policies were violated. We can report that the voluntary, independent internal investigation has come to a close, and we have determined to take no disciplinary action.”
Coinbase initially did not promise to list Bitcoin Cash after forking last year, but later changed its decision. Speculation about insider trading arose on December 19, when Coinbase finally ran a listing of Bitcoin Cash, which caused a sharp jump of Bitcoin cash price and an almost immediate shutdown of trading. Around that time, the Bitcoin Cash rate reached record mark of $3.000. It is noteworthy that at the GDAX at some moment the Bitcoin cash price was $ 9,500.
Class-Action Suits Against Coinbase
Against the backdrop of these events, numerous accusations surfaced regarding to the fact that the employees of the company could take advantage of their knowledge of the approaching listing for their own enrichment.
Coinbase froze Bitcoin Cash trades and CEO of company, Brian Armstrong suggested that it could be insider trading, and promised to carry out Coinbase Bitcoin cash investigation.
When Coinbase stated that the community’s concerns were not fulfilled, a class-action suit was filed against exchange. The plaintiffs are demanding compensation for the losses they incurred due to improper fulfillment of the Coinbase obligations and to hold it to account for violating consumer protection law. It is expected that the Commodity Futures Trading Commission will handle this case.
