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Can Arbitration Clauses Protect Crypto Exchanges from Regulatory Overreach?

Press Releases Crypto News BeInCrypto Can Arbitration Clauses Protect Crypto Exchanges from Regulatory Overreach?

Arbitration is a long-standing business practice that has become increasingly popular in the world of cryptocurrency. As Coinbase faces a potential adverse judgment in two cases currently before the Supreme Court, the implications are broad. Might arbitration in crypto face different outcomes than in other industries?

Arbitration presents a unique opportunity for both businesses and customers. It can protect exchanges from harmful government regulation, or address disputes between consumers and companies. Most importantly, arbitration clauses provide opportunities for dispute resolution not always available in traditional legal processes.

Coinbase Inc. v. Bielski and Suski v. Coinbase are the first wholly crypto-focused matters to come before the Supreme Court. So what happens here might determine the fate of other crypto startups down the line.

The Benefits of Arbitration

Arbitration is an informal process that seeks to resolve disputes in a timely and efficient manner. It typically involves one or more arbitrators who are knowledgeable about the subject matter of the dispute. They allow both parties to present their cases before making a decision.

This can be beneficial for businesses because it may result in quicker resolution than traditional court proceedings. It also allows companies to craft their own customized arbitration clauses, which can include provisions that favor them in the event of a dispute.

SCOTUS Ignores the Arbitration Clause

Coinbase has two lawsuits in hand. Bielski involves a Coinbase user who lost $31,000 to a scammer pretending to be a PayPal representative. Suski concerns a $1.2 million Dogecoin sweepstakes that allegedly confused and misled customers. Coinbase includes an arbitration clause in their user agreement. They have appealed both cases, Go to Source to See Full Article
Author: Virginia Valenzuela

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