Friday, September 17, 2021

Coinbase faces a lawsuit over its direct listing on Nasdaq.

The Takeaway:

A class-action lawsuit has been filed against cryptocurrency exchange Coinbase, its executives, and investors over the exchange's direct listing on Nasdaq.

ADVERTISEMENTKillerlaunch domains

A class-action lawsuit has been filed against cryptocurrency exchange Coinbase, its executives, and investors over the crypto firm’s direct listing on Nasdaq earlier this year. “According to the complaint, the registration statement and prospectus used to effectuate the company’s offering were false and misleading,” the lawsuit alleges. Scott+Scott Attorneys at Law LLP filed a securities class action lawsuit against Coinbase Global Inc, with Donald Ramsey as the lead plaintiff.

 

Lawsuit names Coinbase directors and CEO as defendants. 

The class-action lawsuit names several Coinbase directors and officers, including CEO Brian Armstrong, as defendants. Other defendants include venture capital firms and investors that benefited from Coinbase’s direct offering, including Marc Andreessen, Fred Ehrsam, Fred Wilson, AH Capital Management, Tiger Global Management, Union Square Ventures, and Viserion Investment. Coinbase is one of the largest cryptocurrency exchanges in the U.S. According to its website, the crypto firm currently has approximately 56 million verified users, 8,000 institutions, and 134,000 ecosystem partners in over 100 countries. 

 

Coinbase went public via a direct listing on Nasdaq. 

Coinbase went public on April 14 this year through a direct listing on Nasdaq, making available over 114 million shares of its Class A common stock to the general public. Coinbase’s shares began trading on the Nasdaq exchange at $381 per share. The law firm suing the crypto firm explained, Coinbase allegedly “omitted to state that, at the time of the offering,” it “required a sizeable cash injection” and its “platform was susceptible to service-level disruptions, which were increasingly likely to occur as the company scaled its services to a larger user base.” The lawsuit further claims that “as a result of the foregoing, the positive statements about the company’s business, operations and prospects were materially misleading and lacked a reasonable basis.”

ADVERTISEMENTBtrz jokerbtc 728x90 en

Disclaimer: The article reflects the opinions of the author and is not representative of Chaintimes’ views.
The article does not offer any investment advice. User discretion is advised when investing in or trading with cryptocurrency. Extensive and diligent research should be carried out by the reader before making a decision.

Jai Pratap
Jai Pratap
A Mass Media Graduate who loves to write. Jai is also a sports enthusiast and a big movie buff. He loves to learn new things.

Leave A Reply

Please enter your comment!
Please enter your name here