• A Coinbase user lost $96,000 due to an SMS prompt message and account draining.
• Coinbase denies responsibility for failing to flag several unauthorized transactions.
• Jared Ferguson from New York filed a lawsuit against Coinbase in May 2022.
Lost Funds
A Coinbase user lost $96,000 due to account draining after an SMS prompt message was sent. The hacker drained the plaintiff’s Coinbase account 24 hours after the text message prompting him to change the password was received. Despite this, Coinbase failed to detect any suspicious activity regarding the multiple unauthorized transactions during this time period.
Coinbase Refuses Responsibility
Coinbase refused to take responsibility for these losses and instead informed the victim that they are solely responsible for their security measures such as passwords, 2FA codes and devices. In addition, there have been similar cases of users being denied refunds by Coinbase when smaller sums were stolen via SIM Swap hacks in 2021.
Lawsuit Filed Against Coinbase
Jared Ferguson from New York filed a lawsuit against Coinbase in May 2022 following the theft of his life savings of $96,000 worth of encrypted assets on the exchange platform. He believes that the encryption exchange should be held responsible under both Federal and State Laws for missing unauthorized transactions on their platform.
Unethical Practices Impacting Stock Price
Unethical practices like these have caused customers’ dissatisfaction with their customer support and also taken a toll on Coinbase’s stock price which has decreased 2.7% in the last 24 hours and is currently at $62.77 per share at press time.
Base Layer- 2 Blockchain
Brian Armstrong recently launched Base Layer- 2 blockchain with transaction monitoring features designed to comply with regulatory requirements but it is yet unclear how this will affect customer experience going forward..