Coinbase Global, Inc.

This securities fraud class action arises out of Defendants’ misrepresentations and omissions made in connection with Coinbase going public in April 2021 (the “Direct Listing”). The Direct Listing generated tremendous excitement because Coinbase was the first cryptocurrency exchange to become publicly-traded in the United States. As alleged, Coinbase’s financial success hinged almost entirely on its ability to increase and maintain its customer base, particularly its retail users, which in turn drove transaction fee revenue. Transaction fee revenue accounted for nearly all of the Company’s revenues. 

Unbeknownst to investors, however, during the run up to the Direct Listing and all relevant times thereafter, Defendants failed to disclose numerous material facts and risks to investors, all of which imperiled Coinbase’s financial success. Defendants failed to disclose the material risks arising from Coinbase’s inability to safeguard custodial assets in the event of bankruptcy. That is, that in the event Coinbase went bankrupt, Coinbase customers could lose some or all of their assets stored with the Company. Indeed, Coinbase would later admit on May 10, 2022, that the Company’s inability to protect its customers’ crypto assets from loss in the event of bankruptcy made it likely that customers would find the Company’s custodial services more risky and less attractive, which could result in a discontinuation or reduction in use of the Coinbase platform. 

Plaintiffs also allege that during this same period, Defendants continuously misled investors about the severe regulatory risks that threatened Coinbase’s U.S. business. Prior to the Direct Listing, the SEC was clear that many digital assets in the marketplace were securities under existing federal law. Given the substantial number of digital assets Coinbase made available on its trading platform, and its increased focus on offering “staking” and its “Coinbase Wallet” product, the Company’s susceptibility to adverse regulatory action grew exponentially throughout the Class Period. As alleged, despite Defendants’ knowledge of the critical consequences arising from an SEC enforcement action, Defendants nevertheless denied listing securities on Coinbase’s platform, and assured investors that Coinbase was in compliance with existing federal securities laws and positively engaged with regulators. 

On July 25, 2022, Bloomberg reported that in May 2022, the SEC began investigating Coinbase for listing securities and for potential violations of the federal securities laws. Thereafter, on March 22, 2023, Coinbase disclosed that the SEC issued it a Wells Notice for potential securities fraud violations, which were formally alleged in a complaint filed by the SEC on June 6, 2023. In response to these disclosures, including the May 10 revelation, Coinbase’s stock price dropped, causing significant losses and damages to Coinbase’s investors. 

On July 20, 2023, Plaintiffs filed a second amended complaint on behalf of a putative class of investors alleging that Defendants violated Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, and Sections 11, 12(a)(2), and 15 of the Securities Act of 1933. After briefing the motion to dismiss the second amended complaint, on September 5, 2024, the Court denied in part and granted in part Coinbase’s motion to dismiss. Thereafter, Defendants moved for judgment on the pleadings and to certify for interlocutory review the Court’s September 5, 2024 motion to dismiss order. On September 30, 2025, the Court denied in part and granted in part the motion for judgment on the pleadings, and denied the interlocutory motion. On October 21, 2025, Plaintiffs filed the third amended complaint.  

Read Amended Consolidated Class Action Complaint Here

Read Second Amended Consolidated Class Action Complaint Here 

Read Court's September 4, 2024 Opinion Here

Read Court's September 30, 2025 Opinion Here 

Read Plaintiffs' Third Amended Complaint Here