Coinbase is under legal pressure after a shareholder lawsuit alleges the company concealed damaging incidents that led to a significant stock price drop. The suit, filed by investor Brady Nessler, claims Coinbase failed to notify shareholders about a data breach involving $20 million in extortion attempts, which only came to light on May 15th. This attack involved bribing third-party employees for access to the company’s systems, resulting in the theft of customer information. The lawsuit also highlights a UK regulatory fine imposed on Coinbase by the Financial Conduct Authority (FCA) totaling $4.5 million in July 2024, stemming from violations of a 2020 compliance agreement relating to onboarding high-risk users. 2021’s IPO saw less than one percent of Coinbase’s user base affected but resulted in stock price volatility that has fueled investor frustration. The lawsuit argues that revealing the breach sooner would have mitigated the stock market fluctuations, according to Nessler. The lawsuits also cite a data security issue impacting user information and an Illinois case focusing on biometric misuse. This string of legal challenges highlights Coinbase’s struggles with cybersecurity while facing escalating regulatory scrutiny. Investor confidence in the company’s transparency is diminishing as they demand accountability for these incidents.