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The Commodity Futures Trading Commission (CFTC) said in a press release on Friday that cryptocurrency exchange platform Coinbase had paid $ 6.5 million to settle claims by regulators that it reported data. of deceptive transactions.
According to the CFTC, between January 2015 and September 2018, “Coinbase recklessly delivered false, misleading or inaccurate reports regarding transactions in digital assets.” The agency alleges that two trading programs operated by Coinbase generated orders that traded, which could have misled traders about the volume of trade on the exchange now known as Coinbase Pro.
The CFTC also fined Coinbase for so-called ‘wash trades’ in cryptocurrency Litecoin and bitcoin that were conducted by a former Coinbase employee on Coinbase’s GDAX platform. Wash operations are prohibited because they create a false appearance of trading volume.
A Coinbase spokesperson said in an emailed statement to The edge that she neither admitted nor denied the CFTC’s accusations and that she had “proactively engaged with the CFTC” during her investigation. The statement notes that the settlement order “does not include any finding of harm to a Coinbase customer.” The company says it “firmly believes[s] that Coinbase has always aimed to create a reliable and secure business environment for the benefit of our customers. “
Last month, Coinbase publicly filed documents to list its stock on the NASDAQ stock exchange. According to the company’s S-1 prospectus, Coinbase had 43 million verified users at the end of 2020, with a total of $ 90 billion in assets held in trust. Since its inception in 2012 as a Bitcoin trading platform, Coinbase has processed some $ 456 billion in transactions. Last year, it had a turnover of $ 1.2 billion, making a profit of $ 322 million.
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