US Supreme Court stops Coinbase cases in first crypto ruling.
On June 23, the United States Supreme Court made a decision in favor of cryptocurrency exchange Coinbase. The decision was made in a partisan opinion that will stop court proceedings against the company in two California cases. The plaintiffs in the class-action lawsuits accused Coinbase of failing to provide proper relief after users lost money and engaging in deceptive advertising. However, Coinbase argued that users signed an agreement upon creating their accounts stating that such disputes would be handled through arbitration in lieu of lawsuits. The district courts overseeing the cases dismissed them on the grounds that the users agreed to arbitration upon creating their accounts.
This ruling marks the U.S. high court’s first cryptocurrency-related ruling. California district courts will now kick both cases into arbitration, which is typically less costly for companies than arguing or settling cases through the courts. While this represents a win for Coinbase, it could also have a ripple effect throughout the crypto industry. The Supreme Court’s decision affords Coinbase the same legal treatment typically given to all companies under the U.S. Federal Arbitration Act of 1925.
The court’s decision essentially underpins the idea that existing laws can be seamlessly applied to cases involving the cryptocurrency industry.
