Legal Environment

Coinbase, following Tesla, is reincorporating outside Delaware, citing “unpredictable outcomes” in the Chancery Court, joining Dropbox, TripAdvisor, and Andreessen Horowitz. This trend accelerated after a ruling challenging Elon Musk’s Tesla compensation. Alternative jurisdictions like Texas offer advantages, such as limiting shareholder lawsuits. Companies may also be seeking strategic advantages during Delaware lawsuits. These decisions reflect concerns about Delaware’s legal environment and companies’ broader political positioning with CEOs like Coinbase’s Brian Armstrong becoming politically engaged.