Coinbase’s BCH-Related Insider Trading Investigation Finds Naught
Following a six month internal investigation, Coinbase has found no evidence of employees or contractors conducting insider trading based on Coinbase’s December 2017 listing of bitcoin cash (BCH). An extant class-action lawsuit regarding the insider trading charges means the exchange may still have to clear itself in court.
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Coinbase Finds No Nefarious Evidence
San Francisco-based Coinbase has asserted “no disciplinary action” will be taken after two U.S. law firms it requisitioned to investigate the exchange’s bitcoin cash (BCH) insider trading allegations found no evidence of wrongdoing among the company’s contractors or employees.
The development comes after Coinbase CEO Brian Armstrong launched the voluntary investigation in December 2017 upon the exchange’s listing of bitcoin cash. Controversy arose after the BCH price rapidly exploded on GDAX (now Coinbase Pro) upon news of the listing, leading some users to allege insider trading had taken place.
An anonymous source with familiarity on the matter told Fortune an attorney for the exchange announced the findings and closure of the probe during a mid-July company briefing.
Regarding the outcome of the investigation, a Coinbase spokesperson commented that the company would’ve taken resolute action if necessary:
“We would not hesitate to terminate an employee or contractor and/or take appropriate legal action if evidence showed our policies were violated. We can report that the voluntary, independent internal investigation has come to a close, and we have determined to take no disciplinary action.”
Class-Action Suit Still in Play
The outcome of the internal investigation would seem to be positive news for Coinbase, though it’s not the end of the episode altogether for the U.S. crypto powerhouse.
In March 2018, a group of traders filed a class action lawsuit in the California wherein they accused Coinbase employees of abusing inside information to profit from the exchange’s BCH rollout last year. The plaintiffs are seeking a currently unspecified amount of monetary damages.
There’s no indication for now on how that case will go, or if it will even make it to trial. Nevertheless, it’s safe to assume Coinbase will feel emboldened going forward in the wake of its own probe’s findings.
Beyond such legal proceedings, Coinbase has stayed busy as of late. The exchange recently formed a political action committee and has been given the greenlight to run ads on Facebook again.
What’s your position on the insider trading allegations? Share your views in the comments section below.
Images via Pixabay, Fortune