The Coinbase lawsuit dilemma
Freedom or regulation? Which one is it going to be?
A class-action lawsuit has been launched against Coinbase for "insider trading". The suspicious activity was allegedly evident through the increase in Bitcoin Cash purchases prior to the launch of the currency on Coinbase in December. It seems that some traders were "in the know" as Bitcoin Cash was suspiciously purchased in large quantities just before launching on Coinbase.
Once launched, BCH experienced a massive spike in price due to low liquidity and the frenzied hype of a new currency being available on the popular platform. Those same traders who had been on the "inside" were then able to sell off their BCH at extremely inflated prices. Others lost considerable funds due to the subsequent dumping and freezing of trades on Coinbase's GDAX platform that took place hours later.
This lawsuit and its implications present a dilemma. Regulation is both despised and revered by the same entities, depending on which side of the deal they were on in this particular scenario. If they happened to make a good profit, they may well be of the libertarian "laissez-faire" attitude, whereas if they were on the losing end, they may feel a need for justice to be served.
The entire cryptocurrency sphere was borne out of a desire to move away from the regulatory controls that inevitably corrupt due to a centralisation of power and control. It does seem a little hypocritical for the very same proponents to suddenly cry foul and beg for government intervention when it affects their pocketbooks.
Having said that, many would argue that the cryptocurrency world, to truly experience mass adoption, needs regulation. Without it, it may well remain on the periphery of the financial world. It could continue to be a chaotic mess for some time without regulation.
This problem presents us with a number of questions... do we really want cryptocurrency to be subjected to the powers of regulation? Or is it better to go through a bit of a mess once in a while and not be subject to these corrupting powers? Is it even possible to truly control? Where will these problems and proposed solutions lead us in the future?
Share your thoughts in the comments below!
*This is not professional trading advice - it's just my opinion!
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https://www.ethnews.com/lawsuit-filed-against-coinbase-for-alleged-aiding-and-abetting-of-theft
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Great article! It is interesting watching the Crypto community's reaction to corruption in a decentralized platform and currency. Keep us updated with the lawsuit!