Coinbase Defends Against BCH Lawsuit From Users, Case Ongoing
After 1.5 years of investigation, Coinbase is found guilty not of fraud but of negligence. But the case is not completely over just yet...
Cryptocurrency exchange Coinbase, launched in 2012, is considered to be one of the largest exchanges operating in the United States — and the most trusted. However, an alleged wrongdoing back in December 2017, caused a long court procedure, the outcome of which is still vague and uncertain.
It’s all fun and games until a hard fork
On March 1, 2018, an Arizona citizen and trader named Jeffrey Berk filed a lawsuit in the Northern District Court of California on behalf of exchange users who found themselves in a similar situation, accusing Coinbase of sharing misleading information and — most importantly — insider trading, both of which allegedly resulted in mass losses of funds.
It started when the Bitcoin community was about to split the chain. At the end of July 2017, right before the hard fork, Coinbase declared that it would not support the new coin — i.e., Bitcoin Cash (BCH) — since it was hard to predict for how long it would survive and what its market value would be in the future.
A hard fork is an update to a blockchain performed in order to improve it, get rid of bugs that could have popped up, or to add new features. Eventually, the cha