More Trouble for Coinbase – Another Class Action Lawsuit for “Unfair Business Practices”

A class action lawsuit was filed on March 2 against California’s popular cryptocurrency exchange Coinbase. The prosecution accuses Coinbase of violating California’s Unclaimed Property Act and engaging in illegal and unfair business practices.

 

LOST & UNFOUND

Allegations against Coinbase come from the exchange allowing its users to send Bitcoin, Ethereum, Litecoin and Bitcoin Cash to outside email addresses – rather than cryptocurrency wallets. The emails would include a link allowing the recipient to create a Coinbase account and request their cryptocurrency. However, not all transactions were redeemed and questions were asked about what happened to these unclaimed funds.

 

As explained in the filing:

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Imagine writing a cashier’s check to a friend. The bank withdraws funds from your account, but your friend never cashes the check. Does the bank get to keep the funds? The law clearly says no. But this is exactly what has happened with Cryptocurrencies sent through Coinbase.com…

               

The plaintiffs claim that Coinbase chose to hold the unclaimed cryptocurrencies, instead of advising the senders that the funds were never collected – which is considered a violation of the California State Unclaimed Property Act.

 

That explains the ranking:

Accordingly, this class action seeks to recover these unclaimed Cryptocurrencies and deliver them to the intended recipients, as well as all “forks” thereof (e.g. Bitcoin Cash fork of Bitcoin), and “airdrops” related thereto (e.g., ERC20 […] airdrops of Ethereum related tokens).

Funds that cannot be returned to recipients because of outdated email addresses are requested to be sent to the State of California in order to “avoid unjustified enrichment of[Coinbase].

 

New evidence points to possible insider trading in Coinbase

 

MORE MONEY, MORE TROUBLE

Coinbase has had a lot of problems lately.

 

In parallel to a class action lawsuit concerning violations of California Unclaimed Property Law, a class action lawsuit was filed against the exchange for alleged insider trading.

 

Recently, the exchange has also been forced to deal with the gross duplication of orders placed by users, which has had the effect of emptying users’ bank accounts without authorization. However, VISA has come to accept responsibility for the wrongdoing, although Coinbase’s reputation as a secure exchange for investing in cryptocurrencies has undoubtedly been tainted.

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CaptainAltcoin's writers and guest post authors may or may not have a vested interest in any of the mentioned projects and businesses. None of the content on CaptainAltcoin is investment advice nor is it a replacement for advice from a certified financial planner. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of CaptainAltcoin.com

Felix Kuester works as an analyst and content manager for Captainaltcoin and specializes in chart analysis and blockchain technology. He is also actively involved in the crypto community - both online as a central contact in the Facebook and Telegram channel of Captainaltcoin and offline as an interviewer he always maintains an ongoing interaction with startups, developers and visionaries. The physicist has couple of years of professional experience as project manager and technological consultant. Felix has for many years been enthusiastic not only about the technological dimension of crypto currencies, but also about the socio-economic vision behind them.

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