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Learning & News => News related to Crypto => Topic started by: sirty143 on May 05, 2024, 04:51:43 PM

Title: Class Action Lawsuit Claims Coinbase Operates as Unregistered Broker
Post by: sirty143 on May 05, 2024, 04:51:43 PM
Class Action Lawsuit Claims Coinbase Operates as Unregistered Broker

A new class action lawsuit was initiated against the San Francisco-based cryptocurrency exchange Coinbase on May 3. The legal action claims that Coinbase deliberately sold securities that are unregistered with regulatory authorities... See more for yourself here (https://news.bitcoin.com/class-action-lawsuit-claims-coinbase-operates-as-unregistered-broker/).

Your opinion is greatly appreciated.
Title: Re: Class Action Lawsuit Claims Coinbase Operates as Unregistered Broker
Post by: NotATether on May 05, 2024, 06:33:42 PM
The full text for anyone whose interested:

Quote
A new class action lawsuit was initiated against the San Francisco-based cryptocurrency exchange Coinbase on May 3. The legal action claims that Coinbase deliberately sold securities that are unregistered with regulatory authorities. Additionally, the lawsuit charges Coinbase with operating as an unregistered securities broker.

Lawsuit Alleges Coinbase Illegally Sold Securities Without Registration
According to legal documents submitted in California, a collective of crypto investors alleges financial losses from their investments in various crypto assets. The members of the class action maintain that their “suffered investment losses” stem directly from Coinbase’s conduct.

“Coinbase itself marketed and sold the digital asset securities to plaintiffs and the class as ‘investments,’” the court filing declares.

The lawsuit states that every state across the nation regulates the sale of securities and broker-dealers. “Coinbase has failed to register those persons offering and selling the Coinbase digital asset securities as associated persons of a broker-dealer and has failed to register as a broker-dealer with the SEC, Florida, California, or any other state,” the lawsuit adds.

The legal document asserts that the plaintiffs’ attorneys have utilized the Howey Test on various digital assets, such as algorand (ALGO), decentraland (MANA), polygon (MATIC), near protocol (NEAR), uniswap (UNI), and solana (SOL). For example, the allegations by the plaintiffs suggest that investors in UNI “expected to earn profits through the appreciation in value of their UNI tokens.”

Yet, the lawsuit interestingly omits any reference to UNI’s role as a governance token. The plaintiffs are seeking a favorable ruling from the court to nullify their purchase or sale contracts with Coinbase and to reclaim losses, including the fees incurred under those agreements. The class action comes amidst the firm’s ongoing court battle with the U.S. Securities and Exchange Commission (SEC).

So it's exactly what it looks like it - the lawyers are using the excuse of "unregistered securities" for their clients who traded degen coins and lost their money, so that they can get it back.

So my hunch is, expect this to not succeed, Coinbase will probably get this thrown out.
Title: Re: Class Action Lawsuit Claims Coinbase Operates as Unregistered Broker
Post by: Aanuoluwatofunmi on May 06, 2024, 07:49:15 PM
Quote from: sirty143 on May 05, 2024, 04:51:43 PM
Class Action Lawsuit Claims Coinbase Operates as Unregistered Broker

A new class action lawsuit was initiated against the San Francisco-based cryptocurrency exchange Coinbase on May 3. The legal action claims that Coinbase deliberately sold securities that are unregistered with regulatory authorities... See more for yourself here (https://news.bitcoin.com/class-action-lawsuit-claims-coinbase-operates-as-unregistered-broker/).

Your opinion is greatly appreciated.

For everyone using exchanges, this will be a lesson to us all, we should know the implication of using them now, they have no benefit for safety than exposing us in times of need, because they have with them all your vital information's and they are bound to go by the government regulations which may not be favorable upon the users of bitcoin, using any services should be at our own risk after which we might have verified the whole process.
Title: Re: Class Action Lawsuit Claims Coinbase Operates as Unregistered Broker
Post by: Captain Corporate on May 07, 2024, 12:12:44 AM
So some of the investors went ahead and said "coinbase offered us some stuff, we bought them with our own free will, and lost money, so we blame coinbase for giving us an option to be able to buy these things". That is literally the situation, there is nothing further than that, some idiots went ahead and bought some shitcoins nad lost money because of that, and they are claiming that coinbase should be held responsible. Doesn't make sense at all, but usually when people lose money because of their own stupidity saying "I am stupid and that is why I lost money" is a very hard thing to do, so they start blaming others, it is human nature.
Title: Re: Class Action Lawsuit Claims Coinbase Operates as Unregistered Broker
Post by: TomPluz on May 07, 2024, 06:46:26 AM
Quote from: Captain Corporate on May 07, 2024, 12:12:44 AM
Doesn't make sense at all, but usually when people lose money because of their own stupidity saying "I am stupid and that is why I lost money" is a very hard thing to do, so they start blaming others, it is human nature.

In essence, this class lawsuit can be summarized this way: "We are stupid and have not used our critical thinking when we bought those digital assets and then when we lose money, it must be the fault of Coinbase so we need to be refunded." Now, while I understand that there is really a big problem with Coinbase as it is operating right in the heart of USA which is not a crypto-friendly country and maybe must have cooperated to the highest level with the government so as to avoid getting into legal skirmishes, if this suit will be successful this can open up a Pandora's box and the repercussion can be game-changing and can mean that no exchanges will anymore operate within the legal jurisdiction of the country. I do agree, that essentially, this case is an admission of stupidity and that stupidity must be rewarded a lot by the law and the court, that is if we go with the reasoning of these crypto investors who filed this new class action lawsuit.