Coinbase is under renewed legal pressure after investors filed a class action lawsuit accusing the exchange of concealing critical information tied to a data breach and a UK regulatory violation. The suit, filed Thursday in the U.S. District Court for the Eastern District of Pennsylvania, claims Coinbase misled shareholders by failing to disclose a $4.5 million fine levied against its UK subsidiary, CB Payments Ltd., for breaching a 2020 agreement with the Financial Conduct Authority (FCA).
The lawsuit also alleges Coinbase delayed revealing a significant customer data breach that exposed user information. Lead plaintiff Brady Nessler says these omissions distorted the company’s risk profile and artificially inflated its stock price—causing investors to incur losses once the news was made public in May 2025.
Breach Fallout Triggers $244 Stock Drop
Following public disclosure of the incidents, Coinbase’s stock (NASDAQ: COIN) fell 7.2%, closing at $244—a sharp decline that plaintiffs argue could have been avoided if the company had disclosed the issues sooner. Although the stock has since rebounded to $263.16, investors say the damage is done.
Coinbase acknowledged that the breach could result in remediation costs between $180 million and $400 million. The lawsuit claims the company’s failure to inform shareholders of these potential liabilities earlier constitutes a breach of fiduciary duty.
Armstrong, CFO Named in Lawsuit
The complaint names CEO Brian Armstrong and CFO Alesia Haas as individual defendants, alleging they knowingly withheld material information. Filed on behalf of investors who purchased Coinbase stock between April 14, 2021, and May 14, 2025, the suit seeks financial compensation for losses incurred due to what it describes as a pattern of nondisclosure.
Plaintiffs argue that Coinbase’s actions misled the market about the company’s compliance and cybersecurity risks, violating securities laws and damaging shareholder value.
Quick Facts
- Coinbase is being sued over a UK regulatory fine and data breach.
- Plaintiffs say the company delayed disclosure, misleading investors.
- COIN stock dropped 7.2% to $244 after the news broke.
- CEO Brian Armstrong and CFO Alesia Haas are named defendants.
- The lawsuit seeks damages for stockholders from April 2021 to May 2025.
