Coinbase is one of the largest crypto exchanges in the world. However, the popular platform is not having the best of times at the moment. The exchange was recently hit with a massive $350 million patent infringement lawsuit. If that was not enough, Wells Fargo, one of the biggest financial institutions in the world, has asked investors to sell Coinbase stock, while on CNBC.
The financial giant says that “rising competition and macro pressures will hurt the stock.”
Moreover, even Jim Chanos said that the company did not have a good business model.
The $350 million lawsuit was filed by Veritaseum Capital LLC. The firm alleges that Coinbase infringed upon a patent awarded to Reggie Middleton, who is a founder of Veritaseum. The lawsuit claims that Coinbase “had previous knowledge, should have known or at least was deliberately blind of the ‘566 Patent.” Coinbase “has been on notice of the ‘566 Patent at least as early as July 3, 2022, if not earlier via other sources or parties,” the lawsuit claims in a subsequent allegation.
Not only that but the popular crypto exchange has also been accused of proprietary trading by the Wall Street Journal. The firm allegedly hired traders to make trades and stake crypto using the company’s funds. As per the report, $100m in funds was used in a test trade. However, Coinbase has published a blog denying the allegations.
Moreover, there have been several instances where Coinbase’s ethics were called into question. Earlier in April, the exchange was accused of insider trading. many began to question the tokens that were listed on the platform, as many seemed fishy to some. This led to a cascade of allegations against the crypto giant.
Coinbase’s stock, COIN, seems to be doing pretty well at press time. The stock was trading at $67.31, up by 6.76% in the past day but it is currently down more than 74% from its all-time high.