Reported by Sander Lutz

(Excerpt shared below. To read full report, go to: https://decrypt.co/350490/coinbase-c-suite-andreessen-sued-billions-alleged-insider-trading?amp=1)

A group of Coinbase stockholders has filed a lawsuit against the company’s leadership over an alleged yearslong scheme involving the insider trading of billions of dollars worth of company stock.

The Delaware-filed suit accuses Coinbase’s top executives and investors of suppressing information for years regarding the company’s failures to implement Know Your Customer (KYC) and anti-money laundering regulations, its vulnerability to data breaches, and the degree to which regulators were investigating these issues.

During the period in which this information was allegedly withheld from investors, Coinbase insiders, including CEO Brian Armstrong and board member Marc Andreessen, sold $4.2 billion worth of stock in the company. The plaintiffs allege these proceeds constitute “lucrative insider trading” that took advantage of the “artificially inflated price” of Coinbase stock.America’s top crypto exchange has previously been sued on similar grounds. Last year, a Delaware judge ruled that the core claims of a 2023 investor-backed lawsuit—one which claimed Coinbase’s top brass unloaded stock while withholding material public information —were “reasonably conceivable.” The case is currently moving slowly through Delaware’s court system.

The new shareholder lawsuit, which was publicly filed just before Thanksgiving, focuses on Coinbase’s alleged internal awareness of issues that later caused the company’s stock price to fall.