Coinbase Eats It’s Own Defrauding Own Investors

Coinbase sued in relation to promotion of TerraUSD cryptocurrency by Mike Millard The Block QUICK TAKE Lawsuit claims Coinbase misled the plaintiffs and class into believing that they were purchasing a “reserve-backed stablecoin,” a type of cryptocurrency that is generally less volatile than its counterpart. Complaint also contends that investors lost about $18 billion in a matter of days in May from the devaluation of TerraUSD. Coinbase, a digital currency wallet and trading platform, faces a class action lawsuit filed on Thursday in California Northern District Court in relation to its promotion of cryptocurrency TerraUSD, according to court documents accessed by The Block and published on its server. The lawsuit accuses Coinbase of failing to disclose the risks inherent to TerraUSD and misleading the plaintiffs and class into believing that they were purchasing a “reserve-backed stablecoin,” a type of cryptocurrency that is generally less volatile than its counterpart. Because TerraUSD was purportedly pegged to the US government-issued currency, specifically the world’s reserve currency, it was marketed as a type of investment that could “virtually eliminate volatility,” the filing said, adding that “in reality, TerraUSD is not backed by actual US dollars or any other tangible assets held in reserve.” The complaint also contends that investors lost about $18 billion in a matter of days in May from the devaluation of TerraUSD. SIGN UP FOR OUR DAILY NEWSLETTERS ➞ Also receive our FREE weekly Data & Insights Newsletter By signing-up you agree to our Terms of Service and Privacy Policy The lawsuit was filed by the Milberg Coleman Bryson Phillips Grossman law firm. A message sent to a Coinbase representative seeking comment was not returned by time of publication.

Coinbase sued in relation to promotion of TerraUSD cryptocurrency

by Mike Millard

The Block

QUICK TAKE

  • Lawsuit claims Coinbase misled the plaintiffs and class into believing that they were purchasing a “reserve-backed stablecoin,” a type of cryptocurrency that is generally less volatile than its counterpart.
  • Complaint also contends that investors lost about $18 billion in a matter of days in May from the devaluation of TerraUSD.

Coinbase, a digital currency wallet and trading platform, faces a class action lawsuit filed on Thursday in California Northern District Court in relation to its promotion of cryptocurrency TerraUSD, according to court documents accessed by The Block and published on its server.

The lawsuit accuses Coinbase of failing to disclose the risks inherent to TerraUSD and misleading the plaintiffs and class into believing that they were purchasing a “reserve-backed stablecoin,” a type of cryptocurrency that is generally less volatile than its counterpart.

Because TerraUSD was purportedly pegged to the US government-issued currency, specifically the world’s reserve currency, it was marketed as a type of investment that could “virtually eliminate volatility,” the filing said, adding that “in reality, TerraUSD is not backed by actual US dollars or any other tangible assets held in reserve.”

The complaint also contends that investors lost about $18 billion in a matter of days in May from the devaluation of TerraUSD.

SIGN UP FOR OUR DAILY NEWSLETTERS

 Also receive our FREE weekly Data & Insights Newsletter

By signing-up you agree to our Terms of Service and Privacy Policy

The lawsuit was filed by the Milberg Coleman Bryson Phillips Grossman law firm.

A message sent to a Coinbase representative seeking comment was not returned by time of publication.

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