The Coinbase crypto exchange is facing a class action lawsuit from a Dogecoin buyer seeking $ 5 million in damages. Meanwhile, the DOGE rate is falling steadily.
A Coinbase user filed a class action lawsuit for $ five million. He claims the exchange ran a misleading advertising campaign regarding Dogecoin. From the Court records it emerges that plaintiff David Suski was mistaken. He claims he was lured in trading Dogecoin (DOGE) worth $ 100 to enter Coinbase’s $ 1.2 million sweepstakes. It’s about the so-called Sweepstakes-Competition. Here, prizes are awarded to users of the Coinbase crypto exchange using a kind of lottery system. In the advertising campaign for the promotion in question, according to the indictment, Coinbase urged users to trade at least $ 100 in Dogecoin between June 3 and 10, 2021 in order to enter the raffle.
The plaintiff’s attorney now claims that the campaign was misleading as the rules allowed anyone to participate for free. Coinbase would not have disclosed the rules in advance and instead just mentioned them under a separate section “Rules and Details”. According to these, in order to take part in the competition, it is sufficient for the customer to send in a card with their personal data. Trading in DOGE for the equivalent of 100 USD was therefore not necessary at all to participate in the Sweepstakes-Coinbase’s campaign – the opposite was claimed in the advertising:
The only reason the plaintiff made the decision to buy more Dogecoins from Coinbase was because the company led them to believe that it was necessary in order to enter Coinbase’s $ 1.2 million sweepstakes.
DOGE course has been in free fall for weeks
The question now remains, why is it even a lawsuit worth millions, if the damage is “only” 100 US dollars. The complaint states that a “deceptive digital advertising campaign” may have misled many other retailers as well. These could have paid millions of dollars for Dogecoin purchases on Coinbase. Coinbase is to be held accountable not only on behalf of the plaintiff, but also on behalf of millions of other users.
Since Dogecoin (DOGE) hit an all-time high of $ 0.731578 in March, there have been significant corrections. After Gamestop, the Reddit traders from SatoshiStreetBets, the crypto offshoot of WallStreetBets, chose a price target with DOGE that they could push up with a concerted action. The fall followed, however. Most recently, the price losses within a month were more than 43 percent, in the last 24 hours DOGE lost 9 percent.