The Coinbase user agreement dispute reached the US Supreme Court

The United States Supreme Court has taken up a legal dispute involving Coinbase and its users, specifically raising a significant procedural issue over whether a judge or arbitrator should decide which contract governs disputes.

According to a Bloomberg report, this case stems from conflicting agreements between the parties, with one contract favoring arbitration and the other favoring court litigation.

Coinbase initially applied arbitration clauses to its customers, but the complexities arose from a victorious settlement of disputes in California courts. Following allegations of deceptive advertising, customers challenged Coinbase's customary arbitration process and pursued legal action in a class-action lawsuit.

Coinbase's efforts to expand arbitration have been challenged by lower courts. A federal judge in California, backed by the U.S. Court of Appeals for the Ninth Circuit, affirmed that the settlement must be upheld. Consequently, the company's request to refer the dispute to arbitration was rejected.

Related: Coinbase Cuts Losses, Crypto Trading Volumes Fall in Q3

This judicial refusal comes despite a recent decision of the Supreme Court, which in a related case supported Coinbase 5-4. The court then ruled in favor of the company's efforts to put the customer's lawsuits on hold while it tries to take the dispute to arbitration.

During this legal dispute, Coinbase has remained active. The company has expanded its services by introducing new business options for its users. Eligible retail clients can now participate in crypto futures trading, with contracts representing the value of Bitcoin (BTC) and Ether (ETH) in more accessible volumes.

The Supreme Court's choice to take up this case represents a significant development for companies using arbitration clauses. It highlights the Court's continuing involvement in distinguishing between arbitration and legal proceedings. The ruling could affect the drafting and enforcement of user agreements, particularly in the ever-growing digital currency market.

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