Coinbase Global has been hit with yet another proposed class-action lawsuit, this time from shareholders who say a recent data breach wiped hundreds of millions of dollars off the exchange’s market value.
The complaint, filed 22 May in federal court in Pennsylvania, adds to at least six user-led cases that have piled up since Coinbase revealed the intrusion earlier this month.
Plaintiff Brady Nessler is seeking damages for all investors who purchased Coinbase shares between 14 April 2021 and 14 May 2025.
Extortion Attempt Exposed
On 15 May Coinbase disclosed that several customer-support agents had been bribed four days earlier to compromise internal systems and pull limited account data.
The attackers demanded a $20 million payoff, prompting Coinbase to notify regulators and warn that remediation expenses could reach $400 million.
Shares dropped 7.2% to close at $244 when the news broke before rebounding 9% the following day, highlighting the volatility that now hangs over the stock.
Alleged Disclosure Failures
Nessler argues the cyberattack merely exposed a deeper transparency problem, alleging that Coinbase routinely withholds material information that could influence investors.
He points to language in the lawsuit describing a “precipitous decline in the market value of the Company’s common shares,” which he claims was exacerbated by selective reporting.
FCA Agreement at Issue
Central to the case is Coinbase’s July 2024 fine of £3.8 million ($4.5 million) from the U.K. Financial Conduct Authority for onboarding 13,416 high-risk customers despite an earlier pledge not to do so.
Nessler contends the exchange breached the 2020 voluntary agreement and failed to reveal that fact in its prospectus ahead of the April 2021 Nasdaq direct listing.
Had the violation been public, he says, investors would have questioned compliance controls and priced the shares accordingly.
Stock Performance Under Scrutiny
After the FCA penalty became public last July, Coinbase’s stock slid more than 5% to close at $231.52, an episode the suit cites as proof of the firm’s sensitivity to regulatory setbacks.
The latest breach-related disclosure pushed the price lower again on 23 May, with the stock finishing down over 3% at $263 before slipping further after hours.
Despite those swings, Coinbase remains up roughly 6% year-to-date, reflecting broader optimism about crypto markets and the firm’s diversified revenue streams.
Class-Action Landscape Expands
The Nessler filing is at least the seventh lawsuit tied to the incident, but it is the first to link damages expressly to the share-price drop rather than to customer losses.
It names Coinbase Chief Executive Brian Armstrong and Chief Financial Officer Alesia Haas as defendants, alleging they had direct knowledge of both the UK fine and the breach impact.
The suit seeks a jury trial and unspecified monetary relief, potentially adding millions more to the exchange’s burgeoning legal bill.
Coinbase declined to comment on the new action, citing its policy on pending litigation.
Regulatory Backdrop
The company is already fighting a high-profile enforcement case brought by the U.S. Securities and Exchange Commission, which alleges the platform operates as an unregistered securities exchange.
Legal scholars say the overlapping battles could shape industry standards on disclosure and cyber-risk management.
Some believe the shareholder suit might be consolidated with other cases, streamlining discovery but raising the potential settlement size.
Investor Considerations
Analysts at Mizuho Securities noted that while the breach itself appears limited, the incident highlights ongoing operational challenges as Coinbase scales support amid renewed bull-market interest.
They warned that management faces a delicate balance between growth and risk, especially as fraudsters increasingly target crypto firms.
Outlook
If the plaintiffs succeed, Coinbase could face higher compliance costs and tighter scrutiny from both investors and regulators.
Failure to address disclosure concerns promptly may also complicate efforts to expand internationally, where licenses often hinge on proven governance.
Still, bulls argue the exchange’s liquidity profile and first-mover advantage position it to withstand litigation shocks.
The case will test whether investors view the latest breach as a one-off operational lapse or evidence of systemic weaknesses.
A preliminary hearing is expected later this summer, setting the stage for a protracted legal battle that could influence disclosure standards across the crypto sector.