History of Coinbase Hacking Incidents: A Detailed Overview

As a leading figure in cryptocurrency litigation, Silver Miller has been instrumental in guiding victims through the complexities of security breaches involving the theft of customer assets from accounts and wallets at cryptocurrency exchange Coinbase. Our firm’s proactive approach in these cases has helped many reclaim their losses and navigate the aftermath of Coinbase hacked incidents. This blog delves into the history of hacking at Coinbase, highlighting the recurring security challenges faced by the platform and the legal options available for affected users.

Understanding Coinbase’s Security Landscape

Since its establishment in 2012, Coinbase has grown into one of the leading cryptocurrency exchanges globally. However, its journey has been marred by multiple reported security incidents, underscoring persistent vulnerabilities that have impacted thousands of users.

Examples of Major Hacking Events at Coinbase

• March 2021 and May 2021:  Over 6,000 Coinbase customers had their accounts compromised in the spring of 2021. Unauthorized parties siphoned funds and accessed sensitive personal data, exposing a critical lapse in the platform’s SMS-based two-factor authentication system.
• February 2023: Another breach targeted Coinbase employees via an SMS phishing campaign orchestrated by the hacker group known as “0ktapus.” This breach compromised Coinbase’s internal systems and highlighted the sophisticated nature of attacks that the platform faces.

Regulatory Actions and Coinbase’s Compliance Challenges

Over the years, Coinbase has faced several fines and regulatory actions due to issues surrounding security and regulatory compliance:

• 2023 New York Settlement: Coinbase agreed to a $100 million settlement with New York regulators, addressing alleged failures in its anti-money laundering and Know Your Customer protocols.
• 2023 Dutch Central Bank Fine: Coinbase incurred a $3.6 million fine for failing to register its services with applicable governmental authorities, highlighting non-compliance with local regulations.
• 2023 New Jersey Cease and Desist: The New Jersey Attorney General issued a cease and desist order accompanied by a $5 million penalty upon Coinbase for purportedly engaging in the sale of unregistered securities.

What These Incidents Mean for Coinbase Users

The repeated issues concerning security and regulatory compliance complaints at Coinbase raise significant concerns about the platform’s ability to safeguard user assets and personal information. For those affected by fraud or hacking at Coinbase, these incidents underscore the importance of robust legal representation in seeking restitution for assets stolen from Coinbase accounts and wallets.

As cryptocurrency tracing sleuth ZachXBT has posted on his widely-read social media accounts:

Coinbase needs to urgently make changes as more and more users are being scammed for tens of millions every month. 

Other major exchanges do not have similar panels created by scammers for fraud.  

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Coinbase is in a position where they have the power to make these changes and set a good example but they have chosen to do little to nothing.

Contact Silver Miller for Experienced Legal Guidance

If you’ve experienced a hacked event or are concerned about identity theft related to your Coinbase account or wallet, contacting a knowledgeable lawyer can provide you with the necessary legal support. Silver Miller is committed to helping you understand your rights and exploring viable options for recovering your losses.

For a comprehensive review of your case and to learn more about your potential legal claims, contact Silver Miller. We are here to help you navigate through these challenging issues and secure the justice you deserve in the wake of fraud and security failures.