Coinbase, one of the largest Bitcoin Exchanges and online wallet providers is facing a class action suit from people who lost money when the Cryptsy Exchange failed. This comes after their recent legal battle with the United States IRS.
The suit alleges that coinbase aided Cryptsy in stealing the funds by helping them move the funds without suspicion. This however has not been backed up by hard evidence, and many users are calling for calm citing the fact that a payment processor should not instantly be responsible if it had no idea, due to the stringent checks coinbase already impose on users who use it’s service.
Cryptsy had the funds of many users funds when it vanished and their assets were seized by authorities. The loss of Cryptsy is another reason why online wallets and exchanges should never be used for long term storage of funds in any cryptocurrency.
Coinbase does ask for user ID when setting up accounts for the purpose of managing money of such quantities and performs stringent checks already, it is likely that coinbase would turn over records pertaining to Cryptsy if asked.
This lawsuit is not the first of it’s kind, but is it going too far? Unless any evidence of wrongdoing by coinbase surfaces then we must assume they have done nothing wrong until then, innocent until proven guilty!