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Source: Useacoin, Shutterstock
Summary
- Coinbase’s worth surged to around US$68 billion, aided by the recent surge in Bitcoin.
- The regulator said Coinbase failed to reveal it was running more than one trading program.
- The company’s misleading data potentially inflated the volume of its digital assets, it noted.
Coinbase Global Inc., the world’s largest crypto exchange, has paid a US$6.5 million penalty on charges of falsifying transaction data that may have possibly inflated the trading volume on its GDAX platform.
The US Commodity Futures Trading Commission (CFTC), which investigated the matter, said on Friday that it also fined the digital asset exchange for wash trade in Litecoin and Bitcoin by an ex-staff member.
The settlement comes amid Coinbase’s talks for a stock listing, first by a digital crypto exchange, whose value, according to analysts, rose to around US$68 billion, boosted by the recent surge in Bitcoin prices.
A probe was ordered after it was revealed that orders on two of its platforms matched with one another, resulting in the same transactions between the accounts during 2015-2018. Subsequently, the company had posted the data on its website for reporting services and exchanges.
CFTC noted that although Coinbase was trading on GDAX, it failed to reveal it was running more than one trading program and the misleading information may have inflated the volume of its digital assets.
Coinbase said CFTC did not find any harm to its customers but hasn’t admitted or denied the findings.
Pic Credit: Pixabay
Coinbase’s IPO Plans
Coinbase plans to go public in April, the first major NASDAQ IPO this year, after its original plan for a direct listing in March got delayed. As per people familiar with the matter, the Securities and Exchange Commission (SEC) is currently assessing Coinbase’s IPO application.
Coinbase promoters have enlisted for purchasing as many as 114 million shares when the stock gets listed. Direct listing allows firms to immediately start trading instead of waiting for the lockup period. According to a regulatory filing on Wednesday, several investment firms, such as Andreessen Horowitz, could participate. Coinbase shares were trading at around US $375 in private transactions this year.
Based on the volume and stock price of US$343.58 apiece on March 15, Coinbase would be worth around US$67 billion, which can go up after the listing, analysts say. Earlier this month, videogame developer Roblox Corp. went public with its NYSE debut, another major IPO.
Coinbase’s net revenue had more than doubled to US$1.14 billion last year.
