The Supreme Court backs Coinbase

The US Supreme Court recently backed Coinbase, a leading cryptocurrency company, in a case about using arbitration for customer and employee Misunderstanding. The ruling was a close 5-4 decision.

The decision stated that lawsuits in federal court must pause while a company appeals to move the case to arbitration. Arbitration is a way to resolve misunderstandings outside of court, using an unbiased third party called an arbitrator.

This ruling will have a big impact on the cryptocurrency industry because arbitration agreements are common. It allows companies like Coinbase to enforce arbitration clauses, which can save money and give advantages to the company.

In this important Supreme Court case, Coinbase can now enforce arbitration clauses in contracts with customers and employees. Companies prefer arbitration because it can be cheaper and faster than going to court. Also, the decision from arbitration is usually final and cannot be appealed.

But for consumers and employees, arbitration might be seen as unfair. It can limit their ability to take their claims to court and might result in worse outcomes than a trial by jury. Also, arbitration is often made secret, which could hide potential wrongdoing by companies.

Supreme Court Justice Brett Kavanaugh explained the decision. He said that letting courts go ahead with pre-trial proceedings during an appeal would decrease the benefits of arbitration.

This ruling follows a principle from earlier decisions that says an appeal "takes away the district court's control over the parts of the case involved in the appeal."

This decision is a big win for Coinbase and companies that use arbitration agreements. Even though some people argue that judges should decide which claims should go ahead during an appeal, this ruling strengthens the power of companies like Coinbase to enforce arbitration clauses with consumers and employees.