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Coinbase hit with a $6.5 million penalty from the U.S. CFTC.

Coinbase would suspend trading in the digital currency XRP after U.S. regulators last week filed a lawsuit against Ripple.


The U.S-based crypto exchange giant Coinbase has been hit with a US$6.5 million penalty from the U.S. Commodity Futures Trading Commission (CFTC). The charges, which the CFTC filed and settled on the same day, were for “reckless false, misleading or inaccurate reporting” as well as wash trading on its GDAX digital asset platform. GDAX launched in 2015 and was rebranded as Coinbase Pro in 2018. GDAX/Coinbase Pro is aimed at more “professional” level traders, separate from Coinbase’s spot exchange and wallet apps for everyday digital asset traders.

 

Coinbase is being fined for its actions in 2017 and 2018.

The CFTC’s civil penalties on Coinbase apply to actions that took place between January 2015 and September 2018. A registration document Coinbase filed in February 2021 with the U.S. Securities and Exchange Commission (SEC) referred to a 2017 CFTC investigation into “topics including a 2017 Ethereum market event, trades made in 2017 by one of our then-current employees, the listing of Bitcoin Cash on our platform, and the design and operation of certain algorithmic functions related to liquidity management on our platform.”

 

Coinbase postpones its public listing after the CFTC’s penalty. 

The ongoing investigation into the U.S. crypto exchange by CFTC for its earlier conducts, including the listing of BCH, Ethereum-related events, liquidity market making, and so on. Industry insiders also believe Coinbase could be the first among many, impacting several crypto companies’ public debut. The crypto exchange was all set to make its public debut in the coming weeks, having listed nearly 115 million of its stocks on Nasdaq just a couple of days back. However, the ongoing investigation and a recent fine have pushed the listing a couple of weeks further.



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