Insider Trading Allegations Abound As Ethereum Wallet Buys $400K Tokens Before Coinbase Releases 'Potential' Listings

An Ethereum ETH/USD wallet address purchased at least $400,000 worth of cryptocurrency tokens due to be listed by Coinbase Global Inc COIN a day before the official announcement was made.

What Happened: According to on-chain transactions highlighted by noted cryptocurrency trader Cobie on Twitter, the wallet acquired a significant amount of six tokens mentioned in Coinbase’s list of assets “under consideration” before the information was made public.

 

The tokens acquired were Indexed NDX/USD, Kromatika KROM/USDDappRadar RADAR/USDRAC RAC/USDDFX Token DFX/USD and Paper PAPER/USD each of which saw double-digit percentage gains on Tuesday.

The collective value of the wallet’s initial investment exceeded $570,000 at the time of writing, after seeing a 40% ROI in under 24 hours.

Why It Matters: Tokens named by Coinbase as potential candidates to be listed are known to rally significantly over the short term in a phenomenon that has come to be known as “The Coinbase effect.”

The Ethereum wallet’s curious purchases on Tuesday drove speculation that the buyer was a Coinbase insider with prior knowledge of the assets considered for listing.

As on-chain sleuth Zachxbt pointed out, this isn’t the first time a wallet made large purchases before a Coinbase listing announcement.

Price Action: According to data from Benzinga Pro, Coinbase shares closed 2.61% lower on Tuesday at a price of $149.85.

Photo courtesy: Coinbase

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Posted In: CryptocurrencyNewsMarketsCobieEthereum
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