Coinbase, one of the leading cryptocurrency exchanges in the United States, has recently come under fire from its users due to a security breach that resulted in the theft of funds from at least 6,000 customers. The breach, which occurred between March and May 2021, was carried out by third parties who gained access to customers’ accounts by obtaining their email addresses, passwords, and phone numbers.
According to Coinbase, the third parties likely used phishing attacks or other social engineering techniques to trick customers into disclosing their login credentials. While the exchange claims that the initial data leak did not originate from Coinbase itself, a flaw in its authentication process allowed the unauthorized access to customers’ accounts.
In response to the breach, Coinbase has promised to reimburse customers for the full value of their losses and has updated its SMS Account Recovery protocols to prevent similar incidents in the future. However, the exchange has warned that unauthorized third parties may have accessed and potentially altered customers’ personal details, transaction history, and account holdings.
This is not the first time Coinbase has faced security issues. In 2019, the exchange had to suspend trading of Ethereum Classic after detecting “double spend” attacks amounting to over $1 million. Hacked Coinbase accounts are reportedly valued at up to $610 each on the cybercrime underground.
Despite these challenges, Coinbase remains a popular choice for cryptocurrency traders worldwide. The exchange’s commitment to improving its security measures and compensating affected customers demonstrates its dedication to maintaining trust and transparency within the crypto community.