Coinbase faces legal action after data breach exposes investors to major losses
Investors believe that delayed data breach disclosure and regulatory issues negatively affect their COIN investments.
- COIN investors seek compensation for losses linked to a recent Coinbase data breach
- Investors claim that a 2024 U.K regulatory issue that led to a $4.5 million fine exposed them to losses
Crypto exchange Coinbase is facing another class action lawsuit filed by COIN stock investors led by Brady Nessler.
The lawsuit seeks compensation for investors who bought Coinbase’s stock COIN between 14 April and 14 May 2025. According to the same, these investors incurred financial losses due to the exchange’s alleged lack of transparency in the recent data breach and other incidents.
Nessler’s latest claims
Part of the claims suggested that COIN investors suffered losses when Coinbase publicly admitted to being breached on 15 May.
Notably, the hackers got access to Coinbase’s system and users’ personal data last December, and the team knew about it as early as January but only disclosed it in May.
On this claim, the filing added,
“Defendants failed to take reasonable steps to secure Plaintiff’s account from unauthorized access, despite knowing the risks of hacking and unauthorized transactions in the cryptocurrency industry.”
On 15 May, when Coinbase confirmed the breach, COIN fell by 7.25% and closed at $240 on the charts.
Additionally, the lawsuit referred to another incident from 25 July 2024 when Coinbase’s U.K. subsidiary, Coinbase Payments Ltd (CBPL), was fined about $4.5 million for breaching anti-money laundering law.
The UK regulator (Financial Conduct Authority, FCA) found that CBPL allowed service access to over 13k high-risk individuals to transact over $220 million, despite being against the law.
On the aforementioned date, the shares dropped by 5.5% and closed at $226.5.
According to Nessler and the affected investors, Coinbase’s failure to disclose these regulatory issues exposed them to losses that should be compensated.
“As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of the Company’s common shares, Plaintiff and other Class members have suffered significant losses and damages.”
For the recent breach, Coinbase stated that claims may exceed $400 million.
In a separate lawsuit, the exchange has been under investigation for falsifying its user base in its 2021 IPO (initial public offering) filing.
Worth noting, however, that despite the lawsuit, the stock has rallied by 28% from $200 to $263. It has been boosted by Bitcoin and the broader crypto market’s rebound.
