Still, ter reviewing the reports, a troubling pattern emerged of customers claiming to be out thousands of dollars due to alleged Coinbase mismanagement.
Life savings lost. Desperate sobs for help. Allegations of fraud.
Ter the six years since its founding, the San Francisco-based exchange Coinbase has established itself spil one of the most trusted places to trade ether, bitcoin, litecoin, and bitcoin metselspecie. It’s also run up its share of critics: namely, its customers.
Ter 134 pages of complaints filed to the SEC and the California Department of Business Oversight obtained by Mashable following a five-month FOIA process, a picture emerges not of a responsible actor ter the cryptocurrency space opening the market to fresh investors, but rather a company perplexed by and underprepared for its own success.
And the consequences — spil voiced by Coinbase’s own customers — are enough to give even the most diehard crypto-enthusiast pause.
Money gone and no one huis
A recurring theme te the SEC complaint files Mashable obtained is the seeming disappearance of a would-be trader’s money, and what is portrayed spil an aggressive nonchalance on the part of Coinbase ter response to the loss.
“If I can help to dismantle thesis frauds and protect any other people te America or abroad, I am more than blessed to do so.”
Notably, the SEC redacted the complaints to liquidate personally identifiable information. This, while an understandable privacy measure, makes it practically unlikely to reach out to the complainants for go after up. Spil such, wij’ll mostly let their words speak for themselves.
And there are a lotsbestemming of words.
One complaint, filed te January of this year, is typical of the frustration voiced by many.
“I have sent 17,023.00 from my Coinbase account to another Coinbase account on 12.21.,” it reads. “The other Coinbase account never received the funds spil of 1/16/. I have contacted Coinbase overheen 7 times and all they say is that they have so many issues, they will get back to mij and it is bot a month.”
After claiming to have lost $Five,000 spil a result of the error, the customer levies the following allegation: “I believe the company is holding my funds to make money on top of my investment.”
This individual is far from alone ter his or hier suspicion. Numerous other people allege Coinbase is intentionally withholding their funds for untold purposes. One such complaint, originally submitted to the California Department of Business Oversight and then forwarded to the SEC, accuses the company of “acting criminally.”
“Coinbase has bot te possession of my funds ($21,000) since August 30th, ,” reads the complaint from September of last year. “They have effectively stolen my money at this point. They have no way to reach them by phone, and they are disregarding my repeated attempts to resolve this matter.”
Another individual claims that Coinbase has “stolen” a “majority of [their] life savings,” and despite dozens of attempts to get ter touch with someone at the exchange, they have only received form emails te response.
That complaint wasgoed echoed by another individual te search of their missing $15,000.
Importantly, thesis examples are not outliers te the document batch wij received. Te response to our narrowed FOIA request, the SEC provided Mashable with 115 complaints made against Coinbase. Granted, by their very nature complaints filed to the SEC are not going to be complimentary of the exchange. Still, ter reviewing the reports, a troubling pattern emerged of customers claiming to be out thousands of dollars due to alleged Coinbase mismanagement.
Ter response to request for comment, a Coinbase spokesperson pointed to last year’s surge te rente ter cryptocurrency, and insisted the company is rising the meet the challenge.
“Ter , the cryptocurrency space experienced a profound uptick ter mainstream awareness and growth,” noted the spokesperson. “Spil part of that, consumer request for our services enlargened by 40x and wij experienced transaction volumes te November and December of that year that grew by 295 procent.”
While some users of Coinbase reported eyeing their investments vanish, others found them just out of reach te apparent voortdurend halo.
Te November of last year, one individual wrote to the SEC that they were locked out of their account holding approximately Ten bitcoins, and claimed that Coinbase had copped to the fact that it wasgoed all the company’s fault.
“I am prevented from selling, buying, transferring or accessing my property and also cutoff from all transaction history and other information,” reads the complaint. “After repeated prompting via emails and phone calls, Coinbase advised mij that I am locked out of my account spil a result of a security software error on their end and that they would look into it. That wasgoed a month ago.”
“Coinbase does not get back to you,” observed the same individual, who blamed the lack of response on the company’s prioritization of growth overheen its existing customers. “I believe Coinbase has engaged ter fraud by knowingly marketing a service it knows it cannot actually provide.”
Another user of Coinbase reported much the same thing, noting that they were now on a mission to bring Coinbase down.
“I am glad to take this spil far spil possible, socially, politically, and economically, if I do not receive what I am owed, or proceed to receive no response from the company, both of which I’m sure are fatal,” wrote the person te August. “If I can help to dismantle thesis frauds and protect any other people ter America or abroad, I am more than blessed to do so — just reach out.”
This is not the very first time customers have voiced an intense grudge against the exchange. Te February of this year, a glitch resulted ter the canap accounts of some Coinbase customers being mistakenly drained. Ter response, some Redditors threatened to vertoning up at the company headquarters with guns.
That situation, however, wasgoed a one-off mistake — albeit a truly bad one. A significant portion of what’s contained ter the SEC complaints, on the other mitt, reflects an apparent pattern of alleged mismanagement by the exchange.
Even the result of Mashable’s FOIA request, which wasgoed narrowed down extensively ter a back and forward with the SEC, contains more examples than wij can gezond te this article.
Coinbase clearly isn’t done with its growing anguishes just yet.
One of the good ones
It wasn’t supposed to be this way. Valued at $1.6 billion, Coinbase has placed itself spil an island of respectability te a sea of crypto-shadiness. The company serves with know-your-customer and anti-money laundering laws, and brags about being regulated. And, despite originally fighting the order te court, Coinbase eventually agreed to forearm overheen gegevens on some of its customers to the IRS.
Te a seeming contradiction to the popular trope of cryptocurrency users being mainly criminals and drug users, none of thesis pro-regulation measures appeared to slow the company’s growth. The Coinbase app reached the top of Apple’s App Store last December, and according to Forbes the company generated $1 billion te revenue last year.
And, according to a company spokesperson anyway, Coinbase is making genuine efforts to better serve its customers.
“Overheen the last few months wij have: Enhanced our support team by overheen 150 procent,” and “[decreased] our media time to very first response to <,Ten hours for 95 procent of incoming volume today,” the spokesperson explained overheen email. “Spil a result, wij are able to resolve issues swifter and have decreased the backlog by 95 procent. Wij now have overheen 600 support agents working on our queues across three different locations and wij offerande phone support 24 hours a day, seven days a week.”
Other attempts by Coinbase to address customer complaints have bot documented te a series of company blog posts. One such postbode, highlighted by the Coinbase spokesperson overheen email, from May of this year is written by VP of operations and technology Tina Bhatnagar. Ter it, Bhatnagar acknowledges long wait times for customers seeking help, and lays out extra steps the company plans to take to better its services:
Published Service Levels: Overheen the next 90 days wij will baseline and publish our committed time to resolution so our customers understand the folder wij are setting for ourselves to produce quick resolutions to their issues.
Extra Channels: Ter addition to phone and email, wij will launch social media and talk support straks this year.
Revamped Help Center: Wij will be updating our Help Center by the end of the year for better ease of use, more educational material and a plain way to voeling us.
Surely, this is all a major improvement.
But spil the sampling of Coinbase customer complaints lodged with the SEC and the California Department of Business Oversight makes clear, the company has a lotsbestemming of goodwill and customer trust to rebuild.
It just goes to demonstrate that even the supposed good guys can run into trouble ter the land of cryptocurrency — especially when it’s of their own making.