coinbase main internal problem

Coinbase admits internal error for sending security notifications

To set the record straight, Coinbase, the largest US-based crypto exchange, admitted that the email containing details on security changes of 125 thousand users received Friday, August 24 was caused by an internal error. 

Company spokesperson Andrew Schmitt assured Coinbase customers that days following the incident were focused on answering queries and concerns through correspondence with business news television channel CNBC. 

‘We believe the only way to build trust with our customers is to be transparent when we mess up’ Schmit said. 

On Friday, around 1:45 pm PST, Coinbase users received the email containing the following message: ‘Your 2-step verification settings have been changed’.

Following that email, Coinbase sent a correction to notify the affected users of the erroneous message. 

This caused confusion among Coinbase users and some flocked to Twitter to air their grievances. A report from CNBC also detailed the widespread complaints from users who were also complaining about the lack of customer support and response from the company. 

On August 30, Coinbase released a series of statements on their official Twitter account addressing the alleged hack on their servers. 

‘Our team immediately began work to identify the issue and stop these erroneous notifications. We were able to stop these erroneous notifications by 3:07 pm PST. However, we recognize that this caused confusion for some,’ Coinbase tweeted. 

Many believed that their accounts were hacked by a third party with some claiming that their crypto assets suddenly vanished. An account from Tanja Vidovic, a firefighter from the US said that her crypto assets amounting to US$168 thousand were gone. 

Schmitt confirmed that the email these customers received was caused by an internal error and no malicious hackers are to blame. He also said that the server, all of a sudden, began sending the email like a bug in the system.

As an added response to the complaints of the 125 thousand users that took a hit of the system error, Coinbase also proposed in Reddit that it’s giving away US$100 worth of BTC coins to those affected. 

‘To confirm, we are crediting a small number of users who were adversely affected by this incident with US$100 worth of BTC’, announced by the company’s official support subreddit. 

There’s no specific number of users who will receive the compensation but several investors have posted on Twitter and Reddit that they received their US$100 BTC. 

Earlier in April 2021, Coinbase opened its direct listing and went public. Currently, it has a market capitalisation of about US$65 billion with its profits coming from more than 68 million users around the globe. 

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