Lawsuit Alleges Coinbase Uses “Bitcoin 3-3-3 Pattern” to Manipulate Crypto Markets

On Wednesday, February 7, 2024, Marc Ward filed a civil complaint in the United States District Court for the Northern District of California alleging fraud and market manipulation against cryptocurrency exchange Coinbase and Securities and Exchange Commission Chairman Gary Gensler.

In his complaint, Ward argues that Coinbase uses a sophisticated simulation model to dictate and manipulate the exchange rates of Bitcoin, Litecoin, and Ethereum on its platform. Ward, who has a master’s degree in operations research, believes he has discovered a pattern in the way exchange rates correspond to specific calendar dates and prime numbers. He refers to this as the “Bitcoin 3-3-3 pattern.” Ward contends this “pattern” is evidence that Coinbase is faking trading activity and spoofing the market through its simulation in order to control public sentiment around cryptocurrencies.

Some of the data points Ward cites include bitcoin peaking on the 333rd day of 2013 at $1,108.80 and again on the 333rd day of 2017 when it hit $10,000 for the first time. He also notes fluctuations corresponding to prime numbers on certain dates across Bitcoin, Litecoin, and Ethereum. Ward argues these correlated movements cannot be explained by random chance. He believes Coinbase CEO Brian Armstrong set up the exchange to conduct a “psychological operation” helping to prop up the liabilities of the Federal Reserve through market manipulation.

In his complaint, Ward also accuses Gensler of conspiring with Coinbase, pointing to a since-deleted tweet from the SEC’s Twitter account in January announcing bitcoin ETF approvals. The platform experienced a spike in bitcoin’s price to $47,901 shortly after, which Ward argues was manipulated to cryptically reference the date and bitcoin’s age.

If Ward’s allegations prove true, it could amount to a violation of the Commodity Exchange Act prohibition on commodity market manipulation.

Please contact BlockTribune for access to a copy of this filing.