Coinbase Faces Class-Action Lawsuit Alleging Investor Deception and Securities Violations

Coinbase and CEO Brian Armstrong are facing a new class-action lawsuit alleging investor deception and illegal business practices. Filed in the United States District Court for the Northern District of California San Francisco Division, the lawsuit represents plaintiffs from California and Florida, claiming that Coinbase's digital asset sales violated state securities laws. The lawsuit asserts that tokens like Solana, Polygon, Near Protocol, Decentraland, Algorand, Uniswap, Tezos, and Stellar Lumens are securities, arguing that Coinbase knowingly sold them as such. The plaintiffs seek full rescission, statutory damages, and injunctive relief through a jury trial. This lawsuit adds to Coinbase's legal challenges, including its ongoing dispute with the U.S. Securities and Exchange Commission over the classification of tokens as securities. Despite these legal issues, Coinbase reported robust financial results in the first quarter of 2024, with $1.6 billion in total revenue and $1.2 billion in net income, driven by market performance and the launch of spot Bitcoin exchange-traded funds.