Coinbase Hit With Lawsuit From Shareholder Alleging 2021 Stock Listing Was Based On Misinformation

Earn money with the top Binance exchange

Coinbase Hit With Lawsuit From Shareholder Alleging 2021 Stock Listing Was Based On Misinformation

Top US-based crypto exchange Coinbase is getting hit with a lawsuit alleging that the firm’s 2021 stock listing was based on misleading information.

According to a recent court filing, a shareholder of Coinbase is suing executives from the crypto exchange for allegedly misleading investors into purchasing shares that were “materially different and substantially riskier” than what was disclosed to them.

The plaintiff says that in the months leading up to Coinbase’s initial listing on the stock market, the company generated a massive influx of new users using ad campaigns, which caused the platform’s trading volume to spike, causing a breakdown in its operations and a disruption in its historical growth cycle.

The shareholder says that because of this, the company damaged itself as well as those who invested in it.

“[The] defendants’ efforts to increase Coinbase’s numbers in advance of the Direct Listing backfired, leaving the Company and its newfound investors damaged and vulnerable to the competition.”

According to the complaint, the Defendants misrepresented Coinbase to investors in their Registration Statement right before they sold over $700 million worth of Coinbase stock.

“This misrepresented to investors that the fundamentals behind Coinbase’s historical success were still in place and functioning as normal. Under this misrepresentation, Defendants listed nearly 115 million shares of its Class A common stock on the Nasdaq Global Select Market…

Due to Defendants’ promotional campaign and the damaged state of Coinbase’s ‘platform’ and ‘flywheel’ growth strategy, Plaintiff and other public investors in Coinbase who purchased shares in the Direct Listing unknowingly made an investment that was materially different and substantially riskier than what had been represented in the Registration Statement.”

Source: ethereum.today

Показать больше

Добавить комментарий

Кнопка «Наверх»
%d такие блоггеры, как: