Crypto Community Asks FINRA To Probe Coinbase For Price Rigging
On Saturday, Coinbase revealed its plans to add Cardano (ADA), Basic Attention Token (BAT), ZCash (ZEC), Stellar (XLM) and 0x (ZRX) to its trading platform. As it usually happens, the announcement gave the necessary impetus for the aforesaid coins to gain between 10% and 20%.
However, the Ripple community was not impressed by the decision. Leaving out the third ranked crypto token, which has a market capitalization of ~$18.20 billion, did not make any sense to them. XRP investors were also critical of the fact that other coins with higher market capitalization were also left out in the selection process. The fact that Stellar (XLM), which is perceived as a clone of XRP, is being considered by Coinbase also angered some of them.
Interestingly, requests were made to the Financial Industry Regulatory Authority (FINRA) to investigate Coinbase for possible price rigging practices. In particular, Pete Dakin, a XRP investor used Twitter to request the US regulator to probe into the matter. Dakin alleged that the exchange is wrongly using its power. Surprisingly, FINRA responded to the tweet, saying that it will look into the mater.
Thank you for bringing this to our attention.
— FINRA (@FINRA) July 15, 2018
This is not the first time Coinbase is facing this kind of criticism. The crypto broker’s employees were accused of benefiting from the insider information regarding the list of Bitcoin Cash, which shot up before the public announcement. At that time, Coinbase was forced to investigate the case of alleged price rigging by its employees after the token got listed. This resulted in service outages and wild swing in the price of the coin.
Supporters of Coinbase, however, argue that XRP is not being considered because of the lawsuits it faces. Ripple is not highly decentralized as other cryptocurrencies and Coinbase is concerned about it. Another argument in favor of the exchange is that Coinbase is basically interested in Ethereum based protocols as the cryptotoken is already listed on the exchange. Supporting a new protocol requires additional tests and integrating it to the platform takes time.
As Finra is involved now, we can expect an official clarification from Coinbase.