Elosha (@elosha@chaos.social)

18d

Coinbase didn’t prevent the suspicious transfers, allegedly wiped customer’s transaction history, blamed the customer for the loss, then refused to reimburse. Arbitration concluded with $0 reimbursement.

#crypto #cryptocurrency #Coinbase

56. To add insult to injury, Coinbase wiped clean the transaction history on his account. This was either reckless destruction or a deliberate tactic to keep Spilker from discovering the full extent of his losses. Case 3:25-cv-02573-LB Document 1 Filed 03/14/25 Page 26 of 134 13 57. Perhaps even more damaging is that it left Mr. Spilker without the requisite documentation to accurately file his taxes. 58. Coinbase went to great lengths to cover up its fraud. Coinbase dismissed his concerns, suggesting that he was conflating the cbETH launch (which permitted unwrapping) with the actual merge (which would permit unstaking). 59. Following a demand for repayment, Coinbase informed Mr. Spilker on February 14, 2023 that it would not reimburse his account, and blamed Spilker for supposedly taking inadequate safety measures.

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Coinbase’s Failures to Take Reasonable Care 61. Coinbase should have prevented these unauthorized transactions based solely on the unusual timing of the consumer having his credentials changed, a demand from Mr. Spilker to lock his account, the previously unused wallet where the funds were sent and the unstaking of assets that were supposedly immobilized. 62. Other cryptocurrency exchanges do not allow these same criminal transfers because those exchanges use standard security measures which include freezing an account when certain actions – such as password changes and attempted transfers to newly linked wallets – occur, until the exchange verifies an account holder’s identity.

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18d

Arbitrator found the complaint had been filed too late, and that the customer had admitted that a third party rather than a Coinbase insider had performed the theft. Doesn’t appear the arbitrator investigated the claims of a possible breach, or how the hardware MFA was bypassed.

#crypto #cryptocurrency #Coinbase