On June 7, Charles Hoskinson, the CEO of the Cardano blockchain platform, took to Twitter to alert his 977.1k followers about an “unusual trading” incident discovered by the crypto alert Twitter account “unusual whales.”
The incident involved a significant trade of Coinbase’s token, COIN, and raised concerns within the crypto community.
Hoskinson emphasized the importance of protecting oneself in the crypto space in response to these suspicious events through his tweet as he shared details of the discovery made by Unusual Whales, which revealed that an unidentified whale had initiated a put option trade for COIN with a value of $107,000.
COIN’s market price at the time exceeded the strike price, rendering the options “out of the money” by 19%.
When the Securities and Exchange Commision (SEC) launched a lawsuit against Coinbase, the value of the $107,000 worth of COIN put options shot up quickly, jumping by nearly 2572%.
This happened shortly after the complaint was filed. Unusual Whales remarked on this turn of events by noting, “Those positions are up big,” implying that the whales’ actions were prepared somehow.
The SEC filed a complaint against Coinbase, alleging it was functioning as an unregistered national securities exchange. Coinbase was the focus of the case.
The SEC’s lawsuit against Coinbase on June 6 said that the company had participated in the illegal exchange of digital currencies for billions of dollars over many years.
The value of COIN has significantly decreased as a direct result of the lawsuit, and as of right now, it is trading at $51.61, which is a drop of 12.98% compared to where it was trading only 24 hours ago.
Concerns have been raised within the cryptocurrency community due to the discovery of the odd COIN transaction and the subsequent lawsuit filed by the SEC against Coinbase.
These events have highlighted the significance of regulatory compliance and investor safety within the rapidly developing cryptocurrency ecosystem.