Coinbase Insider Trading: Litecoin Edition

Charlie Lee and Coinbase

Problem 1: Charlie Lee was an employee of Coinbase when Coinbase added Litecoin, a crypto-currency he ‘created’ by simply copying Bitcoin and changing the name and adjusting a few variables and a hash function taken ‘scrypt’ from another crypto-currency.

Litecoin Markets subreddit on March 2017. Nobody was posting.
Uploaded April 12th, 2017 Source (Archive)

Problem 4: Nobody was using Litecoin!

Here’s a chart showing the transactions involving Litecoin. Nobody used it. Even after GDAX added it, nobody cared about it.

Source (Archive)

Segwit Upgrade was not a legitimate catalyst for Litecoin price rising.

Litecoin was not running into any of the capacity limits, and in fact, Litecoin effectively has a 4MB block size already.

Time is 18:17 UTC Source
The time of this Tweet is April 5th, 2017 at 14:15 UTC Source (Archive)
Suspicious activity few days prior to announcement on March 30th, 2017
Source (Archive)

Charlie Lee liquidates his Litecoins

Once Litecoin hit all time highs, around $370, suddenly Charlie Lee was suddenly concerned about ‘conflicts of interest’ and he liquidated all of his Litecoins.

Source (Archive)
Source (Archive)
Charlie Lee executes his sell on December 20th, 2017.
Dramatic increase on December 8th.
Source (Archive)
A trader successfully withdraws Litecoin after Bitfinex refused to allow him to withdraw his money.
A trader successfully trades for Litecoin after Bitfinex refused to allow him to withdraw his money.
Steam does not accept Litecoin, or any other crypto-currency at the moment.


In my opinion, the circumstances regarding Litecoin, Coinbase, and Charlie Lee are suspicious. If I was bringing on someone that created their own crypto-currency and I knew they wanted me to list it on my exchange, I would have asked them to liquidate their positions in it prior to bringing them on.



Get the Medium app

A button that says 'Download on the App Store', and if clicked it will lead you to the iOS App store
A button that says 'Get it on, Google Play', and if clicked it will lead you to the Google Play store



Blog for @Bitfinexed on Twitter. Exposing possible fraud by largest Bitcoin exchange, Bitfinex/Tether