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Bitcoin Cash rises by 70% as Coinbase adds support for the altcoin. The exchange halts trading operations investigating probable insider trading.
Given a huge demand from the side of investors, one of the largest cryptocurrency exchanges in U.S – Coinbase announced support for the first Bitcoin derivative – Bitcoin Cash (BCH). This means that all the retail and professional traders registered on Coinbase can now trade directly in BCH.
The exchange wrote on its official blog:
“We’re excited to announce that customers will be able to buy, sell, send and receive Bitcoin Cash on Coinbase.”
“Who held a Bitcoin balance on Coinbase at the time of the fork will now see an equal balance of Bitcoin Cash available in their Coinbase account. Your Bitcoin Cash balance will reflect your Bitcoin balance at the time of the Bitcoin Cash Fork.”
Soon after the announcement, a huge buying activity was witnessed on the exchange with the BCH price surging by over 70% to a new all-time high of $3813.70, according to CoinMarketCap. Currently, BCH is trading 41% above its intraday low at a value of $3305.15 with a market cap making $55.75 billion.
In addition, in an interesting turn of events, the price of BCH skyrocketed to $8500 on GDAX exchange, which was almost three times higher than the price seen on other exchanges. This accounts for a possibility of insider trading done by Coinbase staff. One, knowing that Coinbase is adding the support for BCH, could have bought BCH in huge quantity on other exchanges. This move is likely to have triggered a huge buying interest within the 10 million Coinbase community.
Brian Armstrong, co-founder and CEO at Coinbase said in a blog post that the company is investigating the matter and the reason behind the spike. In a stern message, Brian writes:
“Given the price increase in the hours leading up the announcement, we will be conducting an investigation into this matter. 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.”
Armstrong said that the Coinbase Staff, friends and family have been forbidden from trading on Coinbase ever since it has been planning to bring the support for Bitcoin Cash. Armstrong explained:
“We’ve had a trading policy in place for some time at Coinbase. The policy prohibits employees and contractors from trading on “material non-public information”, such as when a new asset will be added to our platform. In addition to trading restrictions, it prohibits communication of material non-public information outside the company. This includes to friends and family.”
Coinbase disabled trading four minutes afther the start – it went live at 17:20 PST and was pulled back to post-only mode at 17:24. At 18:30 PST, the exchange wrote:
“All BCH books will enter cancel-only mode, and all existing orders will be cleared. While in cancel-only mode, no new orders will be accepted. We will post an update shortly.”
The exchange has stated that the order books will re-open again on December 20 at 09:00 PST.