Posted on

XRP Listing on Coinbase Pro Raises Community Suspicions

After years of waiting, Coinbase has finally decided to add support for XRP on Coinbase Pro. This surprising decision aroused the euphoria of many, sparking an increase in trading volume and of course a peak in the price of the Ripple’s token.

However, many users, traders, and researchers also shared their suspicions that there might be some ulterior motive behind this decision. For a long time, the controversy over the possibility of XRP being a security and Coinbase’s hermeticism had prevented this from happening despite intense pressure from the community.

With this in mind, and with no significant change in its infrastructure or the legal framework or Coinbase’s terms and conditions, such a swift approval caused several users to share different “conspiracy theories” about this fact.

Is Coinbase Acting Suspiciously?

First of all, those who consider that there is something behind this unusual event point out that perhaps there is an interest on the part of Coinbase.

A recently released report by Diar, suggests that Coinbase deliberately listed XRP on its platform even though the token explicitly violates one of the conditions stipulated by the Exchange for accepting a token.

“Coinbase has now clearly abandoned one of their own pillars for the potential listing of a cryptocurrency. In their ‘Digital Asset Framework’ that outlines requirements to be listed, the exchange states that “the ownership stake retained by the team is a minority stake,” a fact far from reality as Ripple holds nearly 60% of the supply in escrow with a release schedule.

They explain that the reason for ignoring their own conditions could be related to the fact that Coinbase has lately listed all the cryptocurrencies that its own investor “Digital Currency Group” has backed up.

However, most community members who talk about a conspiracy believe that there was insider trading by the Exchange. They explain that those who knew that XRP would be listed bought large quantities of the token, which they sold after the announcement taking advantage of the price pump.

One of those who believe this theory is the twitter user Crypto Bitlord, who explains in a graph how the price of token evolved, telling that there was an unusual purchasing volume just before the news, followed by a large green candle that evidently would not be maintained in time.

Also, Weiss Cryptocurrency Ratings noted that although an “Internal investigation yielded no results.” Just 4 hours before the announcement, XRP experienced an unusual rise. In a survey filled by more than 840 people, 74% of respondents said they believe it could be insider trading.

Or… Should We Blame Ripple?

Alternatively, another group believes that in reality, Ripple was the one to blame. According to this theory, the company would have paid Coinbase to list XRP even though the token does not meet the standards set by the exchange.

One such thinker is Alistair Milne, CIO of Altana Digital Currency Fund. In a first tweet, he explains that he asked Coinbase to clarify the doubt; however, Coinbase replied that they are only willing to answer him privately, something that would prevent him from sharing the answer with the public.

This behavior had already been reported by Bloomberg in April last year. According to the article, Ripple had tried to pay Gemini and Coinbase to list their XRP token.

Miguel Vias, Head of XRP Markets, responded to Milne, commenting that Coinbase’s decisions are autonomous and that RIpple did not participate in any way. He also emphasized the position that Ripple does not own the XRP token.

However, this decision was not enough for Milne (and the rest of the users who share his opinion).

Until now, no official statements have been released by Ripple or Coinbase adressing these accusations.

The post XRP Listing on Coinbase Pro Raises Community Suspicions appeared first on Ethereum World News.

Posted on

Coinbase Drawing Fire From All Sides: What’s Going on at US’s Biggest Exchange?

As the saying goes, tall trees catch much wind,’ and for Coinbase, especially this week, this seems to be true. The seventh biggest exchange through transaction volume, as shown on Coinmarketcap is also the biggest exchange in the US. So, being at the top, it has caught a lot of flak and made a lot of news this week.

Coinbase is an important junction in the cryptocurrency ecosystem, and it has shown on a number of occasions that its influence and direction can shape the entire marketplace globally.

Its decision to integrate SegWit recently saw an upswing in those types of transactions, but on the flipside, its decision to offer Bitcoin Cash also pumped that market- in what is being called insider trading by some. Even rumors about Ripple integration have had its effect on the coin.

In the news this week alone, Coinbase has been sued twice, once for the insider trading allegations, and once for allegations that it “kept” funds that its users sent via email, but which recipients never claimed. It has also been linked to Ripple, again, and has had to deny that- which has caused swings in the Ripple price. Finally, it is still forging ahead as a pioneering crypto ecosystem with its latest offering an index fund.

Laying out lawsuits

Coinbase is no stranger to lawsuits and legal battles, having faced a few days in court before, as well as having fended off the IRS in their quest to obtain users’ trading information through the exchange. But fresh allegations have emerged, dating back to their decision to integrate Bitcoin Cash onto the platform.

At the end of December last year, Coinbase decided to add Bitcoin Cash to their offerings. This saw the price of the forked currency soar, while Bitcoin started to drop off.

Immediately, accusations flew that Insider trading was happening, despite the company making it clear that employees had been restricted from trading BCH on the site for a number of weeks prior to the announcement.

Now, a class action lawsuit has emerged from one of the Coinbase users based in Arizona, Jeffrey Berk. The plaintiff accuses Coinbase of “artificially inflated prices” by means of disclosing buy and sell orders moments after Coinbase launched BCH support. CEO Brian Armstrong said at the time of first allegations, in a blog post: “If we find evidence of any employee or contractor violating our policies,  directly or indirectly,  I will not hesitate to terminate the employee immediately.”

Unfair business practices

This lawsuit comes months after the allegations were laid, but is put forward: “on behalf of all Coinbase customers who placed purchase, sale or trade orders with Coinbase… during the period of Dec. 19, 2017 through and including Dec. 21, 2017… and who suffered monetary loss as a result of defendants’ wrongdoing.”

Additionally, while fielding this lawsuit, Coinbase has also been accused of keeping hold of funds sent by email which were never claimed by their recipients. It is another class action lawsuit that the exchange will have to handle delicately as it looks to keep its reputation intact in a space where there are a number of scam and badly run cryptocurrency services.

To lawsuit has been brought forward to the District Court for the Northern District of California by Restis Law Firm on behalf of two Coinbase users seeks reimbursement of the funds, including those sent involving now-expired email addresses. It is claimed that Bitcoin, which was emailed to people prior to the mainstream acceptance and understanding of digital currencies went unclaimed in many emails, and, instead of returning the coins, Coinbase simply kept hold of them. This falls under the gambit of unfair business practices being leveled at the exchange.

Both of these lawsuits, of course, do not paint Coinbase in the best of lights, despite them only being allegations currently. The negative press associated with bad practices and insider trading can be damaging, and for a company like Coinbase, it is not what is needed as they aim to be a positive precedent setting crypto solution.

It is negative news that is being picked up by some influencers in the community as Tone Vays, Host of CryptoScam podcast, points out how much of their energy and funds are going to just keep afloat with all the legal battles.

Ripple Rumors

One aspect, that they have dealt with before, and have had to deal with again this week, is the rumors that they would be introducing RIpple to the exchange. They have again vehemently denied this, which has had its effect on the Ripple Price.

The company quashed the rumors this time in another blog post by Armstrong as he stated:

“As of the date of this statement, we have made no decision to add additional assets to either GDAX or Coinbase. Any statement to the contrary is untrue and not authorized by the company.”

The effect of this rumor, and then the quashing of it, showed quite prominently in Ripple’s price graph, but, as Matt Odell on Twitter, surmises, Ripple may well still make its way to Coinbase in the same manner in which Bitcoin Cash appeared on the exchange.

The blog post goes further to outline the process that Coinbase follows when making a decision to add a new coin to its stable, and as one can imagine, it is not a simple process. Coinbase faces a lot of scrutiny and has many watchful eyes on them when making big calls, and thus it is up to them to make sure it is executed perfectly, for their own well-being, and that of the entire crypto market.

Forging ahead

It is not all doom and gloom for Coinbase as they look to put out fires along the way. The most recent move by the exchange is to move them in somewhat of a different direction, offering weighted index fund for cryptocurrencies. What this means is that, for US citizens, there is a chance for investors to exposure to all assets listed on the company’s current exchange, GDAX, depending on their market capitalization.

This is a step in a slightly different direction for Coinbase as they expand their market to reach those who are perhaps more akin to traditional investments, broadening the net and amalgamating crypto and traditional assets.

Still, as with the fires they are trying to put out in the lawsuits, the Index fund has been met with mixed reviews.

Managing partner at Full Tilt Capital, a venture capital firm and real estate solutions company that has its eyes on crypto, Anthony Pompliano, believes this is a crossing over of traditional and crypto investors.

However, the move is confusing to Meltem Demirors, vice president at Digital Currency Group as she states the same thing can be achieved on the Coinbase platform without the need for the two percent charge.

Frank Chaparro, a well-regarded cryptocurrency writer for Business Insider also drew people to the fact that this move by Coinbase is one that is aimed at “tap[ping] Wall Street’s appetite for cryptocurrency” in a tweet that linked to his article.

Eyes on Coinbase

Like it or not, Coinbase’s prominence as a cryptocurrency platform, in a country with such high media coverage as the US, puts it in the public eye, and as such, it garners attention from all sides. Even other platforms are keeping an eye on what Coinbase does, and how it handles certain situations, in order to navigate their own way through the unprecedented cryptocurrency ecosystem.

Mati Greenspan, the senior market analyst of trading platform eToro, mentions how even though they are based in the UK, the two companies work together somewhat in order to keep abreast of things such as regulations and trends.

“In the UK, we work with Coinbase and other leading platforms and exchanges through Crypto UK, a self-regulatory trade body designed to set standards for the industry, so it’s a collegiate relationship.”

As Coinbase continues to try and set a bar of expectation for cryptocurrency services, it faces an uphill battle against regulators and broaching new territory. However, it is important to have established pioneers, but ones that can be trusted, working to define this new ecosystem and industry, even if it is simply to lay a workable path down.

Posted on

Korean Regulator Investigating Staff Insider Trading of Cryptocurrencies

An official from South Korea’s Financial Supervisory Service (FSS) has reportedly said that an investigation is underway into insider trading within his organization.

Choi Heung-sik, governor of the FSS, said the regulator – an executive arm of the Financial Services Commission – will make public any findings on the allegations of illegal trading of cryptocurrency by one of its staff members.

According to the Korea Times, Choi said:

“We’ve acknowledged allegations that an FSS official sold crypto-assets based on insider information before the government’s updated announcement to regulate the market. We are looking into this case.”

The news source also cited Hong Nam-ki, minister of the office for government policy coordination, as saying that policies on trading digital currencies vary between government offices, and it will take time to develop a unified policy on the matter.

Yonhap news agency also indicates that multiple staff may have been involved in insider trading.

The alleged insider trading is said to have occurred prior to Korean regulators announcing new rules on cryptocurrency trading in the country – a move that has been, at least in part, linked to the recent slump in prices across the crypto markets.

With the restrictions, banks have faced closer scrutiny over their relationships with cryptocurrency exchanges, and holders of anonymous virtual accounts must now attach their identity or face fines. A possible ban of cryptocurrency exchange trading is still being considered, according to officials, and a decision is expected to be made during Thursday’s parliamentary session, Reuters says.

Korean National Assembly building image via Shutterstock

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at