Overview
- Plaintiffs allege Coinbase insiders, including CEO Brian Armstrong and board member Marc Andreessen, sold $4.2 billion in stock while withholding material information on risks.
- The suit cites long-running gaps in KYC and anti-money-laundering controls, undisclosed regulatory scrutiny, and delayed disclosure of a vendor-related customer data compromise.
- According to the filing, executives knew by January that hackers obtained sensitive customer information via third-party providers but the breach was not revealed publicly until May.
- Shareholders seek multibillion-dollar damages, board seats, and governance reforms, while Coinbase’s board characterizes the stock sales as routine monetization by well-capitalized insiders.
- The case follows a 2023 Delaware ruling calling similar claims reasonably conceivable and references Coinbase’s $100 million NYDFS settlement, with the company now planning to shift its corporate charter to Texas.