Cryptobros are suing Coinbase for its role in promoting and trading the GYEN “stablecoin”. GYEN is a stablecoin running on Ethereum that is intended to maintain a value of one Japanese yen.
Outraged Coinbase customers say the company locked them out of their accounts after “technical reasons” forced it to stop trading GYEN. Reminds me of the Ripple (XRP) that I still hold.
According to the complaint, “investors placed orders thinking the coin’s value was, as advertised, equal to the yen,” but noted that the tokens they were buying “were worth up to seven times as much as the yen. “.
They added that just as suddenly as their purchases were made, “the value of GYEN plunged again – dropping 80% in one day.”
The lawsuit came a day after Coinbase (COIN) stocks and bonds plunged to a fresh low at $44.35, signaling investor skepticism about the crypto exchange’s prospects in a bear market that deteriorates.
The complaint goes on to state due to “the omission of the fact that GYEN was not designed to hold yen-indexed security, and Coinbase’s restriction prohibiting investors from liquidating their GYEN as it collapsed .
Due to this restriction, several hundred buyers have lost huge sums, with some losing hundreds of thousands of dollars in just a few hours. Users say it caused them “grief, anxiety, stress and outrage”.
Stablecoins such as Dai and Tether were designed to be as volatile as the US dollar and have values that generally change much less than those of Bitcoin and Ethereum.
Who knows what the future holds for crypto as the market seems to have recovered a bit. There is speculation that this is just the “dead cat bounce” before the actual crash.
What do you think? Is the latest crash a sign of an even bigger future crash? Sound off in the comments!
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