Coinbase said trading will resume later today.
Coinbase Inc., one of the most popular USA cryptocurrency exchanges, is investigating allegations of insider trading on its platform in the hours before the company announced it would enable purchases of the bitcoin spinoff known as bitcoin cash.
The start of Bitcoin Cash trading on the Coinbase exchange was supposed to be a great opportunity to get into a major new cryptocurrency while its values weren't yet through the roof, but that's. not how it panned out.More news: Al Franken will resign from the Senate on January 2
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Shortly after trading opened, the price of bitcoin cash rocketed to a high of $8,500, more than double what it had been on Monday. Speculation is that is has caused a shift from users in bitcoin to that of bitcoin cash.
Coinbase stated on its Bitcoin Cash blog announcement that it "maintains a strict trading policy" and employees have been "prohibited from trading in Bitcoin Cash for several weeks".
Bitcoin cash is trading higher after a slate of announcements from Coinbase. From a cursory glance, it looked like someone knew about the Coinbase move in advance, triggered a flurry of trading that led to a spike in price, and took advantage of this for a massive windfall. Just four minutes after enabling trading of the cryptocurrency on its Global Digital Asset Exchange (GDAX), Coinbase halted it. It features a change in the digital software that was created to speed up the efficiency of transactions as the value of bitcoin ballooned.
In a post on Medium, he elaborated: "We've had a trading policy in place for some time at Coinbase. If we find evidence of any employee or contractor violating our policies?-?directly or indirectly?-?I will not hesitate to terminate the employee immediately and take appropriate legal action." wrote Coinbase CEO, Brian Armstrong.