Coinbase CEO, Officers, Insiders Avoided $1 Billion in Stock Losses, Suit Says

Robert Burnson

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Coinbase Inc. Chairman and Chief Executive Officer Brian Armstrong, board member Marc Andreessen and other officers avoided more than $1 billion in losses by using inside information to sell stock within days of the cryptocurrency platform's public listing two years ago, before bad news sent the share price tumbling, according to a lawsuit filed by an investor.

The company's board deployed a so-called direct listing instead of a more typical initial public offering and rapidly sold off $2.9 billion in stock before Coinbase management later revealed "material, negative information that destroyed market optimism from the company's first quarterly earnings release forward," according to the complaint unsealed Monday in Delaware Chancery Court.