Coinbase stock dropped after Supreme Court's Dogecoin ruling
Supreme Court Ruling Tanks Coinbase Stock: Why?
Coinbase's stock fell over 3.5% after the Supreme Court ruled against the crypto exchange in a case involving a Dogecoin sweepstakes. The court decided that it, not an arbitrator, should determine the arbitration eligibility of the dispute from June 2021, where consumers alleged they were misled into entering a sweepstakes with fees. This follows a series of legal setbacks for Coinbase, including a recent ruling allowing the SEC to pursue a lawsuit against them for unregistered securities sales.
What specific allegations did consumers make against Coinbase in the Dogecoin sweepstakes case?
In the Dogecoin sweepstakes case, consumers specifically alleged that they were deceived into paying $100 or more to participate in a sweepstakes. The contest, held in June 2021, promised participants a chance to win prizes totaling up to $1.2 million in the cryptocurrency Dogecoin. The central issue in the lawsuit was whether these consumers were misled by Coinbase's promotional practices surrounding the sweepstakes.
What immediate impact did the Supreme Court's ruling have on Coinbase's stock price?
The immediate impact of the Supreme Court's ruling on Coinbase's stock price was a significant drop. Following the announcement of the court's decision, Coinbase’s stock price fell by more than 3.5% during mid-morning trading.