Due to the complications arising from Terraform Labs‘ blunder, Coinbase has been hit with yet another lawsuit. According to the filing data, the firm neglected to notify users that it had a long-standing relationship with LUNA’s parent company, Terra. Investors are also upset that the crypto exchange did not respond quickly enough to assist them in mitigating their losses when the problem first arose.
Investors are blaming Coinbase for the losses
According to rumors, this is the company’s second lawsuit, with the first being filed a few weeks earlier. The first involves GYEN token holders claiming compensation for Coinbase’s participation in the token’s depreciation last year. According to the lawsuit filed in court on Thursday, the corporation neglected to undertake adequate investigation before supporting the listing of TerraUSD.
Some investors also argued that the firm failed to adequately describe the dangers associated with successfully purchasing and trading the stablecoin on its platform. The investors point out that, unlike other platforms, Coinbase notified its consumers that the stablecoin was exactly like the rest of the crypto market.
The exchange is now fighting a GYEN-related case
Coinbase Ventures was also identified as one of the strongest firms supporting Terraform Labs, according to the listing documents. The company’s stated arm is responsible for creating high-value investments to create money. This association, according to investors, was one of the reasons Coinbase neglected to warn consumers about the significant dangers of buying and trading the stablecoin. Legal organizations from three firms in the United States of America are representing the disgruntled investors.
One of the law firms is also a legal team member defending investors in their attempt to compel the corporation to compensate GYEN stablecoin investors. After the value of the alleged stablecoin went as far as it could before plummeting, investors began to protest. As a result, the firm imposed a restriction and suspended certain users’ accounts on the site. According to the lawsuit, as a result of the depegging, certain consumers experienced significant losses.