This week in the crypto world, we saw Coinbase ride a legal rollercoaster, the FBI report record losses to crime and Tether come in for more criticism.
Coinbase Up…Then Down
It was a mixed bag for Coinbase this week. First, the judge in its case against the Securities and Exchange Commission (SEC) ruled largely in its favor over a request for internal communications from the agency, which Coinbase thinks will help it in its case. It had already withdrawn a request for SEC Chair Gary Gensler’s personal communications, knowing that it would be rejected, and its lawyers will hope to find contradictory messages that it can use against the agency in court.
The same day, however, the exchange learned that a class action lawsuit against it by shareholders will go ahead. The group is suing Coinbase over a claim that the company played down the likelihood of the SEC filing the above lawsuit, and the judge in the case found that Coinbase has a case to answer.
Whoops.
FBI Reports Record Crypto Crime Losses
The FBI’s Internet Crime Complaint Center (IC3) this week reported a sharp increase in cryptocurrency-related fraud in 2023, with over 69,000 complaints filed and record losses of over $5.6 billion. According to its 2023 Cryptocurrency Fraud Report, this figure represents a 45% rise from the previous year, highlighting the growing trend of criminals exploiting the decentralized and largely unregulated world of cryptocurrency.
A significant portion of these losses stemmed from investment fraud, which accounted for nearly 71% of all cryptocurrency-related losses, with older crypto participants the most likely to get caught out. The report highlights the growing issue of crypto users being targeted, explaining why adoption continues to lag behind expectations.
Tether Tarred and Feathered by Consumer Group
A consumer advocacy group this week warned that cryptocurrency users should be “deeply troubled” by the actions of stablecoin issuer Tether due to its “shady practices” and lack of transparency.
Consumers’ Research, an independent nonprofit organization, feels so strongly about the issues surrounding Tether that it has espoused its message through a dedicated website, tetherwarning.com, where it lists the company’s various crimes, including the lack of an audit and its various legal entanglements.
Of course, those of us who have been in the crypto space for more than five minutes are more than aware of these allegations, but we are also aware that Tether just keeps on truckin’.
