The world’s largest crypto exchange, Coinbase, is facing a federal class action lawsuit over claims that it failed to adequately protect user accounts from cyberattacks and theft.
The complaint, filed by attorneys from BraunHagey & Borden LLP, asserts that Coinbase falsely represents itself as having never been hacked and that its digital wallets are secure. The plaintiffs contend that Coinbase’s account security system is vulnerable to attacks and that the platform has failed to prevent a series of breaches that resulted in significant losses for users.
These breaches occurred less than a year after Coinbase reached a $300 million settlement regarding similar claims from the California Attorney General.
The lawsuit alleges that the company was indifferent to consumer losses. Victims who sought assistance from Coinbase reportedly found themselves stuck in an automated complaint process, which prevented meaningful interaction with customer support and did not address the theft of their funds.
The suit seeks restitution, civil and punitive damages, as well as injunctive relief and other remedies.
Trial attorney Matt Borden stated, “Coinbase plays a valuable and important role as a financial institution with billions of dollars in custodial funds. It needs to take that role seriously as an industry-leading platform used by ordinary consumers.”
Coinbase has not yet provided a comment on the allegations.