Coinbase is facing legal action by one of its users for failing to keep customers’ accounts accessible during moments of high market volatility. Acting on behalf of all Coinbase wallet and account holders, plaintiff George Kattula has alleged that the cryptocurrency exchange does not properly employ standard practices to keep consumers’ accounts secure.


According to the plaintiff’s filing, Coinbase improperly and unreasonably locks out its users from accessing their accounts and funds. He alleges that this singular action means the company has broken their promise of providing customer technology that helps deal with the real-time, global nature of the cryptocurrency asset markets.


The inconsistency in accessing one’s account can contribute to significant losses in the highly volatile digital asset market. For Kattula, he was locked out of his account for an extended period, preventing him from conducting any trade, and resulting in his loss of money. The plaintiff also claims that Coinbase both fails to safeguard its customers’ digital assets or respond to its customers’ complaints in a timely manner.


The allegations didn’t stop there as Kattula also argued that Coinbase has flouted federal and state laws by refusing to register as a broker-dealer and publicly denying that it needs to do so. In July, the exchange published a blog post claiming that it does not list securities. The plaintiff concluded that he and class members had been harmed by Coinbase by losing exclusive access to their accounts, digital assets, investment opportunities, and information.


Coinbase stock crashed last month after news emerged that it was under intense scrutiny by the United States Securities and Exchange Commission. The Commission also believes Coinbase is guilty of having listed nine securities as tokens. The exchange also faced severe pressure from the commission last year after it’s attempt to launch a lending service.


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