The exchange claims Honscha misused the domain for affiliate marketing and later redirected it to unrelated services while operating an email address that could pose phishing risks. Coinbase also alleges he tried to coerce the company into buying the domain under threat of potential data leaks. Separately, Tornado Cash co-founder Roman Storm’s high-profile trial is approaching its final stages, with closing arguments expected this week. Storm is seeking an additional $1.5 million in legal funding.
Coinbase Targets Squatter
Coinbase filed a federal lawsuit in California against Tobias Honscha, a resident of Isernhagen, Germany, accusing him of cybersquatting and breach of contract over the domain name coinbase.de. The crypto exchange alleges that Honscha is using the domain in bad faith to exploit Coinbase’s well-established brand and reputation, which has been built over more than a decade.
According to the lawsuit, Honscha initially used the domain to host an affiliate link to Coinbase, which allowed him to earn commissions when users signed up through the link. However, Coinbase claims this violated its affiliate agreement, which strictly prohibits affiliates from using the words “Coinbase” or “Coin Base” in their domain names or presenting themselves as representatives of the company.
(Source: Justia)
After Coinbase requested that he stop using the domain for affiliate purposes, Honscha allegedly repurposed the site to redirect visitors to a mobile application that allows users to trade physical coins. Coinbase also claims that Honscha operated an email service through the @coinbase.de domain This made it possible for him to potentially intercept or receive emails from people who might mistakenly believe they were contacting the real Coinbase.
The exchange argues this creates a big risk of phishing and other cybercrimes, including the unsolicited submission of identity documents, passwords, and two-factor authentication codes.
The complaint also shared some details about conversations in which Honscha allegedly warned Coinbase of the potential for phishing attacks or data leaks if the company did not agree to purchase the domain from him. Coinbase interpreted this as a veiled threat and an attempt to coerce the company into paying an inflated price.
At the time the lawsuit was filed, the domain redirected to a coin collector forum listing Honscha as a responsible party. Coinbase is seeking damages, forfeiture of profits obtained through the domain, termination of its use, and a court-ordered transfer of the domain to the company.
Tornado Cash Trial Heats Up
Other legal cases in the crypto space are also picking up steam. Roman Storm, one of the co-founders of Tornado Cash, issued an urgent appeal for an additional $1.5 million in legal funding for his high-profile crypto trial that is heading into its third week.
In a July 26 post on X, Storm acknowledged the quickly escalating legal expenses and praised his legal team for working tirelessly. He even stated that they’ve “forgotten what normal sleep feels like.” The crypto community already contributed more than $3.9 million toward his defense, with Storm’s Legal Defense Fund now seeking a total of $5 million. The Ethereum Foundation also met its separate $750,000 fundraising goal to support Storm.
The trial began on July 14 in Manhattan, and could set a legal precedent for how open-source privacy tools are treated in the United States, especially due to concerns over potential chilling effects on decentralized finance innovation and user privacy. US prosecutors allege that Storm conspired to launder money, breached US sanctions, and operated an unlicensed money-transmitting business through his involvement with Tornado Cash.
Although the crypto mixing tool has been praised for preserving financial privacy, it has also been criticized for its use by bad actors, including the North Korea-linked Lazarus Group. These concerns prompted the US Treasury's Office of Foreign Assets Control (OFAC) to sanction Tornado Cash in August of 2022. However, the sanctions were successfully challenged by users, which led to their removal in March of 2025.
Storm co-created Tornado Cash in 2019 alongside Alexey Pertsev and Roman Semenov, inspired by Ethereum co-founder Vitalik Buterin’s emphasis on privacy. Pertsev was found guilty of money laundering in the Netherlands in May and is appealing the decision, while Semenov remains a fugitive on the FBI’s most-wanted list. Storm’s trial is expected to conclude around Aug. 11.
Storm May Testify
According to Inner City Press, closing arguments in the Storm case are expected early this week. Judge Katherine Failla said she anticipates hearing final statements from both sides by Tuesday or Wednesday, which does not give Storm much time to present his defense.
It is still unclear whether Storm will actually testify, as he previously stated he “may or may not” take the stand. Friday was the 10th day of the trial and ended with testimony from an FBI special agent who claimed Storm had control over some funds tied to Tornado Cash.
The defense began presenting its case on Thursday, starting with Ethereum core developer Preston Van Loon, and plans to call up to five witnesses in total.
Overall, the case attracted a lot of attention from the crypto community, with people like Ethereum co-founder Vitalik Buterin and Paradigm’s Matt Huang contributing to Storm’s legal defense fund. Buterin previously expressed public support, due to the importance of privacy and the right to publish open-source software.
Meanwhile, Storm alleged that his account with the payroll provider Gusto was deactivated, potentially due to his legal situation.
