Coinbase, a digital currency exchange operator, agreed to pay a $6.5 million civil penalty to settle charges from the Commodity Futures Trading Commission (CFTC) for reporting violations and improper trading activity by a former employee.
Between January 2015 and September 2018, Coinbase “recklessly deliver[ed] false, misleading, or inaccurate reports concerning transactions in digital assets, including Bitcoin, on the electronic trading platform it operated, GDAX,” the CFTC stated in its order Friday. Coinbase was utilizing two automated trading programs: “Hedger,” which maintained inventory for the platform’s brokerage business, and “Replicator,” which operated to maintain liquidity on GDAX.
