Cryptocurrency exchange Coinbase is facing a class-action lawsuit over vague rules of a dogecoin-related contest. According to a complaint, filed by David Suski, he would not have invested $100 in the altcoin to participate in Coinbase's "Trade Doge, Win Doge" contest if the exchange had made it clear that the contest was free to enter.
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Suski claims the marketing firm hired by Coinbase intentionally used "false and misleading digital ad campaigns" to hide the possibility of free participation. The plaintiff also provided a screenshot in which the link to the rules of the drawing is presented in small faded print. Contestants were offered the opportunity to win the $300,000 grand prize, as well as one of several prizes of $ 30,000 and $100.
By law, in such draws, companies must provide an opportunity to participate free of charge. Suski claims that Coinbase improperly hid the free membership option in order to increase liquidity on the exchange. According to him, the company could not fail to realize the fact of the violation as it had previously raffled off $2 million in bitcoin (EXANTE: Bitcoin) in a similar way.
The bitcoin draw, however, required only registering an account on Coinbase to participate, whereas in the dogecoin story, users were motivated to invest $100 in order to "make a trade" with the cryptocurrency. Suski accuses Coinbase and the marketing firm of violating unfair competition and misleading advertising laws. He estimated his own damage and damage to other participants in the campaign at $5 million.
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