Coinbase Investigates Insider Trading Soon After Announcing Support for Bitcoin Cash

Terry Joseph
December 21, 2017

"If we find evidence of any employee or contractor violating our policies - directly or indirectly - I will not hesitate to terminate the employee immediately and take appropriate legal action".

Apparently, there is some case of insider trading ahead of its announcement - and that caused significant volatility in the price where the order book showed that bitcoin cash hit a high of $9,500.

"Bitcoin cash is a very legitimate contender", said Bobby Lee, chief executive officer of BTC China Co.

However, many exchanges, including Coinbase, initially refused to support the innovation, casting doubt on its prospects. If anyone knew about this and bought Bitcoin Cash before the announcement was made, they could have easily made 300 percent in profit by selling on GDAX. Bitcoin cash surged on the news, up 41 percent over the past 24 hours, to $3,305.15 as of 10:45 am London time, according to data compiled from coinmarketcap.com.

Although there have been other Bitcoin splits before, this "fork" was unusual in that everyone who owned the original virtual currency was offered a matching sum of Bitcoin Cash.

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"Given price increase in the hours leading up the announcement, we will be conducting an investigation into this matter".

In a post on Medium, he elaborated: "We've had a trading policy in place for some time at Coinbase". However, the trading of bitcoin cash on Coinbase was short-lived, as the cryptocurrency exchange halted it and launched an insider trading probe.

The start of Bitcoin Cash trading on the Coinbase exchange was supposed to be a great opportunity to get into a major new cryptocurrency while its values weren't yet through the roof, but that's. not how it panned out. CEO Brian Armstrong wrote in a separate post that the company would investigate whether staff or contractors had acted on "material non-public information"-basically, insider trading".

Coinbase addressed the accusations with a statement saying that it prevented employees from trading in bitcoin cash weeks before the listing.

Market watchers noticed this week that the recent bitcoin cash increases seem to be coming at the expense of bitcoin because investors were starting to rotate out of it and into other cryptocurrencies, including bitcoin cash.

Other reports by Free-Prsite

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