Case Background:
This is a securities fraud class action lawsuit on behalf of persons and entities that purchased or otherwise acquired Coinbase Global Inc. (“Coinbase”) Class A common stock pursuant and/or traceable to the registration statement and prospectus issued on or around April 14, 2021. On April 14, 2021, Coinbase filed its prospectus on a Form 424B4, which forms part of the registration statement. Coinbase registered for the resale of up to 114,850,769 shares of its Class A common stock by registered shareholders. According to the registration statement, the resale of Coinbase’s stock was not underwritten by any investment bank and the registered stockholders would purportedly elect whether or not to sell their shares. Such sales, if any, would be brokerage transactions on the NASDAQ, and Coinbase would purportedly not receive any proceeds from the sale of shares of Class A common stock by the registered stockholders. Thus, Coinbase’s operations would continue to be financed with cash flow from operating activities and net proceeds from the sale of convertible preferred stock. As of December 31, 2020, Coinbase had cash and cash equivalents of $1.1 billion, exclusive of restricted cash and customer custodial funds.
The complaint alleges that one month later, the high-flying promise of Coinbase came to a screaming halt, as Coinbase conceded the need to raise capital and revealed performance issues that prevented users’ ability to trade cryptocurrencies. On May 17, 2021, Coinbase announced its plans to raise about $1.25 billion via a convertible bond sale. Then, on May 19, 2021, Coinbase revealed technical problems, including “delays . . . due to network congestion” affecting those who want to get their money out.
The complaint alleges that the Offering Materials were false and misleading and omitted to state that, at the time of the Offering: (1) Coinbase required a sizeable cash injection; (2) Coinbase’s platform was susceptible to service-level disruptions, which were increasingly likely to occur as Coinbase scaled its services to a larger user base; and (3) as a result of the foregoing, the defendants’ positive statements about Coinbase’s business, operations, and prospects, were materially misleading and/or lacked a reasonable basis.
Current Status of Case:
On March 13, 2025, this action was voluntarily dismissed. This action has concluded.
If you wish to discuss this action or have any questions concerning this notice or your rights or interests with respect to these matters, please contact Kessler Topaz Meltzer & Check, LLP: Jon Naji, Esq. (484) 270-1453; or via e-mail at info@ktmc.com. If you would like additional information about the suit, please click on the link "Submit Your Information" above and fill out the form as promptly as possible.