Coinbase, one the largest players on the cryptocurrency exchange market, did not unearth any proof of insider trading in Bitcoin Cash (BCH) by its employees or other contractors close to the company.
Quoting anonymous sources, Fortune reported that the detailed inquiry took a few months and was conducted by two major US law firms. They were hired by Coinbase to investigate the events that took place last December and did not find evidence of any wrongdoing.
The inquiry was launched at the end of 2017, prompted by suspicions of insider trading by Coinbase employees ahead of the announcement that BCH would be added to the platform. A few hours before the news release, the cryptocurrency saw a sudden price surge, which caused many in the crypto community to suspect some Coinbase employees took advantage of the sensitive information and bought BCH ahead of the market. Roger Ver, however, had tweeted in support of Coinbase, saying that insider trading is not necessarily a bad thing.
Normally, such price surges happen after Coinbase or another major cryptocurrency exchange announces the addition of a coin to its tradable asset portfolio. This development has come to be known as “the Coinbase effect.” However, the BCH price surge before the announcement was unusual.
“We would not hesitate to terminate an employee or contractor and/or take appropriate legal action if evidence showed our policies were violated. We can report that the voluntary, independent internal investigation has come to a close, and we have determined to take no disciplinary action,” a Coinbase spokesperson told Fortune.
A Coinbase insider told the media outlet that a staff lawyer brought up the subject at a company-wide meeting with employees last week, discussing the outcome of the inquiry.
The findings of the internal investigation may be good news for Coinbase, but it remains to be seen if they will factor into the class action lawsuits initiated by Coinbase clients this March. They accuse the company and its employees of insider trading and violating California’s unclaimed property law and its unfair competition law.
This article appeared first on Cryptovest
