Coinbase Hit With Another Lawsuit for Restricting Users' Access to Accounts

Coinbase, counted among world's largest cryptocurrency exchanges, has been on a streak of being hit by legal cases in recent times. In a fresh development, the company has been sued for ‘improperly and unreasonably' locking users out of their accounts, especially during these recent days of market volatility. In her lawsuit, plaintiff George Kattula has also alleged that the San Francisco-based company does not maintain standard practices to secure user accounts. Kattula decided to take a legal action against Coinbase after having suffered consequences of not having his account accessible via Coinbase.

“This is a class action brought by plaintiff on behalf of all Coinbase wallet and account holders who have had their accounts breached and incurred losses arising from the unauthorised transfer of assets – including the unauthorised transfer of ‘crypto' securities listed on Coinbase's platform without a registration statement, without Coinbase having registered as a broker or dealer, and without Coinbase having registered as a securities exchange,” the lawsuit filed with the US District Court for the northern district of Georgia, Atlanta division said.

The complaint has questioned Coinbase's promise of providing real-time and global nature of the crypto asset markets.

As per Kattula, he was locked out of an account for a prolonged period, that restrained him from participating in trade, costing him money.

As for now, Coinbase has not addressed the case on a public domain.

The crypto exchange is under probe from the US Securities and Exchange Commission (SEC) that is checking if Coinbase listed nine securities in the form of tokens.

The price of Coinbase shares also plummeted by as much as 21 percent after the SEC opened its investigation on the exchange.

In June, the company also laid-off 18 percent of its workforce, calling it a cost-cutting measure in these ongoing times of industrial dips.

In May, Coinbase reported a 44 percent fall, the crypto exchange only managed to rope-in $1.17 billion (roughly Rs. 9,037 crore) in revenue in the first three months of this year.