Brett (Based)

Algorand

Brett (SOL)

Base

Stellar

Coinbase is facing a fresh class-action lawsuit, with the plaintiffs alleging that the exchange built its entire business model on a lie.
The <a href="https://storage.courtlistener.com/recap/gov.uscourts.cand.429018/gov.uscourts.cand.429018.1.0.pdf" target="_blank" rel="noopener noreferrer nofollow">lawsuit</a>, filed at the US District Court of California, alleges that Coinbase admitted in its user agreement that it was a securities broker. As such, the company has been knowingly violating securities laws since its inception.
The plaintiffs in this case are Coinbase customers: Brett Maggard, Eduardo Cordi, Edwin Martinez, Gerardo Aceves, Thomas Fan and Tiffany Smoot.
The complaint alleges that when the exchange filed for its Initial Public Offering (IPO) in 2021, it disclosed that it offered securities while not being duly registered to do so.
The lawsuit also mentions tokens offered by Coinbase that are deemed to be securities including Solana (SOL), Polygon (MATIC), Near Protocol (NEAR), Decentraland (MANA), Algorand (ALGO), Uniswap (UNI), Tezos (XTZ), and Stellar (XLM).
The plaintiffs are now seeking full rescission, statutory damages and injunctive relief.
The recent lawsuit is similar to a previous one filed by Coinbase customers accusing the exchange of selling unregistered securities.
Coinbase had a <a href="https://assets.ctfassets.net/c5bd0wqjc7v0/IM8PsiQNNYor7VRrv0V6s/f009950970dfdac472f24314b13fdc43/23-184_Documents.pdf" target="_blank" rel="noopener noreferrer nofollow">major win</a> in this lawsuit after a judge determined that the secondary sale of cryptocurrencies on the exchange does not violate the Securities Exchange Act.
<h2 id="coinbase-battles-legal-woes-despite-stellar-q1-performance">Coinbase Battles Legal Woes Despite Stellar Q1 Performance</h2>
The exchange is currently tangled in a legal war with the US Securities and Exchange Commission (SEC). The <a href="https://insidebitcoins.com/news/coinbase-accuses-sec-of-overreach-in-lawsuit-says-it-wants-regulatory-authority-to-match-its-ambition" target="_blank" rel="noopener noreferrer nofollow">case</a>, which is already ongoing, questions whether some tokens listed on Coinbase, should be deemed as securities.
Despite these legal battles, Coinbase continues to post solid financial results. During the first quarter of 2024, the exchange reported $1.6 billion in total revenue and $1.2 billion in net income.
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">
 Coinbase crushed it in Q1 2024
 – Revenue: $1.6B (+72% vs Q4) – Opex: $0.9B (+5% vs Q4) – Net Income: $1.2B (+331% vs Q4) – Adj. EBITDA: $1.0B (+213% vs Q4) – Cash: $7.1B (+24% vs Q4) – 2x USDC on platform vs Q4 – 8x Base developers vs Q4 <a href="https://t.co/nEO96t687p" rel="noopener noreferrer nofollow">pic.twitter.com/nEO96t687p</a>
 — Ryan Rasmussen (@RasterlyRock) <a href="https://twitter.com/RasterlyRock/status/1786140390858625402?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">May 2, 2024</a>
</blockquote>
<script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
Revenue from customer transactions increased by 99% from the previous quarter to $935 million. Revenue from institutional transactions also increased by 133% quarter-over-quarter to $85 million.
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Coinbase Faces a Fresh Class-Action Lawsuit over a “Deceptive” Business Model

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