According to a Bloomberg report today, a judge ruled that Coinbas must face negligence because the company was accused of having problems with the online digital currency Bitcoin Cash (BCH) because of "missing caused by haste."
San Francisco District Judge Vince Chhabria dismissed a large number of allegations, but rejected the application for arbitration through arbitration and ruled that BCH buyers (rather than sellers) could file a lawsuit.
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Chhabria ruled that the renewed lawsuit “coinbase violated its reasonable interpretation of maintaining normal market responsibilities”.
In December 2017, Coinbase allowed more experienced traders to trade BCH in US dollars on their platform for a short period of time, but the company suspended the service in two minutes on the grounds of “high volatility”. A few hours before the announcement of the BCH news on the Coinbase website, the price of the BCH began to increase, triggering a survey of potential insider trading.
In July last year, after completing a few months of independent investigation, a Coinbase spokesperson said that there was no insider trading in the process of launching BCH, so he decided not to take disciplinary action against any employee.
The judge wrote that the decision to suspend the transaction was an indication of the malfunction of the (exchange). He said that BCH buyers believe that Coinbase could have announced the launch of the BCH transaction a long time in advance to avoid price spikes.
The judge ruled that the buyer had a reasonable incentive: because the Chicago Mercantile Exchange (CME) started Bitcoin futures trading the day before, it was eager to go online. According to Chhabria, this may explain why buyers' orders are filled with limit orders that exceed market value.
On the other hand, the seller claimed that they lost the opportunity to sell at a high price, which was caused by the decision to suspend the transaction, according to the ruling, this is not because of Coinbase's negligence.
Coinbase’s allegations of fraud and unfair competition were dismissed. The company did not immediately respond to an email requesting comment.
The case is the Berk v. Coinbase case filed by the District Court for the Northern District of California (San Francisco), case number 18-cv-01364.