The court returned for revision a lawsuit against Coinbase on charges of insider trading BCH
Insider trading in the case of cryptocurrencies and cryptomeria — phenomenon is not something to encourage, but it is quite common. And, as in the case of a lawsuit against Coinbase, was not punishable, the plaintiff simply was not enough evidence.
The largest US crypto currency exchange, we can say that we got off lightly — the district court for the Northern district of California found the Coinbase charges in insider trading when included in the listing of Bitcoin Cash is not enough convincing.
According to the verdict, the plaintiff, a resident of Arizona Jeffrey Burke, “is not clearly articulated the legal basis of their claims” in the lawsuit. Burke spoke on behalf of all customers of Coinbase, affected by the actions of the exchange on 19-21 December 2017, when Bitcoin Cash was added to the listing.
Burke claimed that on December 19, Coinbase “suddenly announced” the opening of orders for the purchase and sale of the most successful fork of bitcoin, but its employees and other insiders knew about this for another month.
In the result announced in advance, according to the plaintiff, the insiders, in a matter of minutes flooded the market with orders, “buying Bitcoin is Cash at a fair price, but reducing the liquidity”. As a consequence, the price of the coins to other traders very quickly skyrocketed.
According to judge Burke in his statement of claim failed to specify what exactly in this situation was the actions of Coinbase, which could be interpreted as illegal.
“Reading the statement of claim does not give answers to questions about what Coinbase was supposed to do differently, or why start trading Bitcoin Cash would have gone more smoothly if Coinbase acted otherwise, in doing so, as Burke believes, it would be advisable to do”, — said in the verdict.
Therefore, the court returned the statement of claim to completion “with one comment”. The plaintiff now has 21 days to supply updated and expanded statements. The point was that references to the law on commodity exchanges — the judge noted that such a reference would make sense if we were talking about the deal with the futures and not commodity, which the court considers Bitcoin Cash.
Recall that the story of the beginning of trading Cash Bitcoin on Coinbase was really quite loud and controversial — first session lasted four minutes after the start, after which the auction was stopped due to a sharp growth of quotations. Very sharp growth at an average market price of $2900 course BCH on Coinbase approached $9000.
CEO of crypto currency exchange Brian Armstrong suggested that it could be due to the fact that someone from the staff of the exchange in spite of the ban started trading asset and promised to investigate the incident.
However, one of the pillars of the community Cash Bitcoin Roger Ver was quick to say that nothing terrible has happened, and that insider trading in principle, there is nothing wrong.
As reported Hash#Telegraph, the study of the General Prosecutor of the state of new York revealed that the crypto currency exchange in General would rather share views of Faith.
They sell on their own sites themselves and allow you to trade to their employees. Some limitations, however, still exist — individual crypto currency exchange, for example, forbid employees to trade on foreign platforms. Gemini and Bittrex require staff regular reports on trading activity and the ownership of bitcoin, Bittrex still limits for staff participation in the trading two days a quarter.
As for Coinbase it is remembered in this report the highest share of prop-trading, up to 20% of turnover. However then representatives were quick to clarify that enter into transactions on its own platform in the interests of customers, subscribers, Coinbase Service.