Customers of Coinbase have sued the exchange for the advertising and trade of GYEN, a failed stablecoin. The lawsuit targets both Coinbase and GMO-Z.com, the issuer of the GYEN stablecoin, according to a report published earlier today.
Yesterday, customers of Coinbase filed a class-action lawsuit in a federal court in Northern California. The complaint alleges that Coinbase and GYEN’s issuer, Tokyo-based GMO-Z.com, misled investors about the token’s stability. As a result, shareholders suffered millions of dollars in losses.
According to the complaint, GMO-Z.com issued GYEN with a 1:1 peg to the Japanese yen. However, when Coinbase listed and began trading GYEN, its value fell below that of the Japanese yen in November of last year.
Coinbase suspended GYEN trading after the 80% drop. According to the complaint, the exchange exacerbated the already-existing loss by denying customers the opportunity to sell the asset. As a result, GYEN investors on Coinbase lost millions of dollars in a matter of hours.
The investors who filed the lawsuit want to represent all GYEN shareholders. They did not, however, identify the amount of compensation they sought.
GYEN is currently trading at $0.007732 at the time of writing. This number refers to the value of the Japanese yen in relation to the US dollar.
This announcement comes after Coinbase just released its financial report for the first quarter of 2022.
The same report states that the exchange’s net revenue fell by 53% to $1.165 billion. Coinbase also reported a $430 million net loss.
