Two More Coinbase Lawsuits: Law Decoded, Aug. 1-8

Both plaintiffs allege that Coinbase made fraudulent and misleading statements regarding the company's business.

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The Coinbase drama, which began in late July, continues with new developments. Last week, former Coinbase Global chief product officer Ishan Wahi pleaded not guilty to two counts of wire fraud conspiracy and two counts of wire fraud in federal court in Manhattan. Wahi was arrested while attempting to board a flight from the United States to India in May and charged with insider trading.

While the Wahis are at the heart of two separate court cases, two more lawsuits were filed last week against the San Francisco-based crypto exchange. Law firm Bragar Eagel & Squire has revealed that it will sue Coinbase for making misleading claims about its business practices. Pomerantz LLP also filed a lawsuit against the exchange, alleging that it is entitled to compensation for any losses suffered as a result of the defendant's violations of federal securities laws.

In both complaints, the plaintiffs allege that Coinbase made fraudulent and misleading statements regarding the company's business, operations, and compliance efforts between April 14, 2021 and July 26, 2022. Coinbase allegedly refused to disclose that he allowed US citizens to trade digital assets that required Securities and Exchange Commission (SEC) registration as securities despite his knowledge and complacency.

11 people are charged with over $300 million in crypto 'pyramid scheme'

A hot season for law enforcement, indeed – the SEC has indicted 11 people for their alleged role in creating the Forsage platform, a “fraudulent crypto pyramid scheme”. The charges were brought in a United States District Court in Illinois, with the SEC alleging that the platform's founders and promoters used the "fraudulent crypto pyramid and Ponzi scheme" to raise more than $300 million from "millions of retail investors worldwide".

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