Representatives of the Coinbase crypto exchange, referring to the user agreement, demanded that the dispute in the lottery case with Dogecoin be considered in private arbitration, and not in general court order. But the US court refused the trading platform.
Former clients filed a lawsuit against the American crypto exchange. Users claim to have been scammed into paying $100 or more to enter the Coinbase Dogecoin contest.
Last June, the platform was raffling off $1.2 million in Dogecoin prizes. To participate, users were required to register an account by signing the terms of the user agreement. Among the conditions was a clause according to which all disputes and disagreements must be settled through private arbitration, and not in a general judicial procedure.
One of the participants of the lottery is sure that the company tricked him out of more than $ 31,000. The user claims that he provided a certain person, who introduced himself as a PayPal representative, access to his account. After that, he tried to contact Coinbase employees, but they ignored the appeal.
Representatives of the crypto-exchange, in turn, claim that this type of fraud is very common, about which they specifically warn users in advance in the user agreement. Well, since the agreement is signed by the user, any disputes must be resolved through private arbitration.
Earlier, the US Supreme Court denied Coinbase a claim through arbitration, but the company filed a lawsuit to appeal this decision. The district court of appeals nevertheless upheld the decision, citing official lottery rules. The rules state that all disputes must be resolved in local California courts.
Recall that the shares of the company and part-time one of the largest crypto exchanges in the world, as of December 2022, are trading at a historical low of $36.60 US. 2022 was the busiest year for Coinbase in terms of communication with law enforcement agencies – the American site received 12,300 requests from them.
