As per CoinEdition, a group of Delaware-based shareholders filed a derivative lawsuit against Coinbase executives, including CEO Brian Armstrong and board member Marc Andreessen, alleging a multi-year insider trading scheme. The suit claims that insiders sold $4.2 billion in stock while concealing regulatory risks, including a $100 million NYDFS penalty and undisclosed security breaches. Plaintiffs argue that the 2021 direct listing was structured to bypass IPO lock-ups and maximize insider liquidity. This is the second legal challenge against Coinbase's leadership over alleged insider trading, with a 2023 case involving $2.9 billion in stock sales. Coinbase's board has defended the direct listing as a routine move under the structure's mechanics.
Shareholders Sue Coinbase Executives for $4.2B in Insider Trading Allegations
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