Class-Action Lawsuit Looms Over U.S. Crypto Exchanges
The latest legal controversy surrounding cryptocurrency may come in the form of a large class action lawsuit from ordinary investors against major U.S. cryptocurrency exchanges. According to a news release assessed by FOX Business, securities attorney Tom Grady, widely recognized as one of the nation’s leading investor fraud attorneys, is getting prepared for future lawsuits against some of the largest cryptocurrency exchanges in the country, including Coinbase, Robinhood, Kraken, and others.
Grady has begun looking into whether or not the exchanges are breaking the law by trading digital coins. A vast majority of it was considered by the SEC to be unregistered commodities and thus function in contravention of federal regulations. Grady claims the exchanges might have deceived investors by failing to provide adequate warnings about the potential loss associated with buying and selling unregulated cryptocurrencies.
In the past, exchanges like Coinbase and Robinhood have argued that they continue operating and do not facilitate transactions of coins that have been regarded as unregistered securities even by the SEC (Securities and Exchange Commission). However, neither Coinbase nor Robinhood Fintechs immediately responded to requests for comment, and Kraken declined to comment.
According to the press release, Grady’s legal company in Tampa, Florida, is actively recruiting clients of Robinhood, Coinbase, and other markets who have lost money while investing in cryptocurrency on those sites. As the SEC began performing risk analysis against several crypto companies in 2017 for marketing unregistered securities, the crypto industry’s argument over how digital assets are categorized has stirred up.
The SEC maintains that the great majority of digital coins are unrelated to the underlying blockchain technology, a commercial transaction technique still in its early phases of development to provide a cheaper, safer, and more productive payment system for customers.