Coinbase representatives have urged clients to disregard social media reports about sudden account bans.
1/ There’s a lot of FUD/misinformation out there about Coinbase restricting accounts.
— Coinbase Support (@CoinbaseSupport) December 8, 2024
The support team assured that there is only a “slight increase in the number of restricted accounts” following a surge in users.
“We are seeing a spike in activity from new and returning clients reactivating their accounts after the elections. Alongside this, we observed a 2–3-fold increase in fraud attempts. […] Our systems are functioning as expected. In November alone, they saved users from losses amounting to tens of millions,” the platform’s representatives explained.
Coinbase advised “not to believe everything on X,” as complaints might be FUD. This prompted an angry response from some community members.
Security researchers criticized the exchange’s policy of viewing VPN use as a “red flag” in risk models.
In recent weeks, attacks on Coinbase users posing as platform support have increased. Malefactors managed to “clean out” several accounts, according to security researcher pcaversaccio from the SEAL 911 team.
An update on this retarded take: yesterday skiddies (again) decided to fake Coinbase support and drained multiple accounts. But sure, disallowing VPN will save you. CB is fucking clown show at this moment. https://t.co/3z23Ew2yrV pic.twitter.com/CvsFSv6aib
— sudo rm -rf —no-preserve-root / (@pcaversaccio) December 8, 2024
“But sure, banning VPN will save you. Coinbase is a freaking clown show at this moment,” he wrote.
In early December, the exchange’s Chief Product Officer Scott Shapiro noted that “attackers always use VPNs.” For this reason, risk models “perceive it as a negative sign, even if clients are doing nothing illegal.”
PSA: Don’t use a VPN to access Coinbase.
Attackers always use VPN’s, so our risk models take that as a negative sign even if you’re legitimately using your own account.
— Scott Shapiro ? shapiro.eth (@scottshapiro) December 2, 2024
The top manager clarified that using a VPN alone will not lead to special account flags.
“These tools [VPN or ad blocker] combined with other factors like logging in from an unknown device in a new country can trigger a false alarm, requiring additional security checks,” — he added.
In response, Nick Percoco, a colleague of Shapiro from the competing platform Kraken, pointed out that such a policy by Coinbase forces some users to choose between financial freedom and physical safety.
Crypto users are some of the most privacy and security minded users on the planet. There are also places on the planet where is it physically dangerous to access a crypto exchange without a VPN masking their destination from the local ISP.
You are making some of your users… https://t.co/vrurMgyvpd
— Nick Percoco (@c7five) December 3, 2024
Earlier, Coinbase was accused of monopolistic practices after refusing to support Celo’s migration to L2.
Back in December, the exchange will cease trading wrapped bitcoin WBTC. On September 12, the company launched its own tokenized version of the first cryptocurrency.