A federal judge ruled Monday, April 23, that a class action lawsuit against cryptocurrency guru Coinbase must be held in an open court. This comes after the plaintiff in the case, Silver Miller, accused Coinbase of money laundering and had requested private arbitration.
In the white collar world, private arbitration is preferred by plaintiffs because negotiations can have terms that might not sit well in the public eye and which can lead to faster settlements, and it's sometimes preferred by defendants since it can save some embarrassing information from becoming public. Since this is no longer an option, the case is likely to become a media frenzy.
Silver Miller alleges that Coinbase helped launder about $8.3 million of stolen Bitcoin, which today is worth over $100 million.
This isn't Silver Miller's first foray into cryptocurrency-related litigation. In 2017, Paul Vernon, the CEO of former cryptocurrency exchange Cryptsy, was found guilty of stealing cryptocurrency from users of his site and was ordered to pay $8.2 million. Silver Miller's law firm had a hand in that case.
The case this time around is a little different. Vernon spent two years converting his users' cryptocurrency into liquid and material assets before he fled the country. Coinbase, on the other hand, has basically been accused of negligence.
According to court documents, the plaintiffs are seeking damages because Coinbase failed to "properly monitor customer accounts" and ignored "suspicious activities" that would qualify as unlawful under the United States' money laundering laws.
Interestingly, Silver Miller was happy with the decision to make the case a public trial.
Coinbase has been the subject of plenty of controversy lately. In March, the business was accused of insider trading when it started accepting Bitcoin Cash to its wallet and exchange services. Most recently, the company suspended a WikiLeaks related account, causing backlash from the whistle blower community.