Coinbase Faces Backlash Over Restricted Accounts and Support Delays

Coinbase has made headlines with two significant developments: the celebration of its 100th perpetual futures contract listing on Coinbase International and growing concerns over account security and support on its main platform. While the international exchange expands its offerings with new listings, including Algorand and Moo Deng, reports of fraudulent activity and account restrictions have raised questions about Coinbase's customer experience and security measures. 

Coinbase Responds to Surge in Account Restrictions and Fraudulent Activities: Users Voice Concerns Over Support and Security

Over the weekend, Coinbase found itself under scrutiny as several users reported sudden account restrictions on the platform. Complaints flooded social media, particularly X, where frustrated customers sought clarity. In response, Coinbase's @CoinbaseSupport account addressed the issue in a series of posts, urging users to exercise patience and caution. ”Please bear with us and don’t believe everything you see on Twitter,” the account emphasized.

The recent surge in complaints coincides with reports of an uptick in phishing attacks and fraudulent schemes targeting Coinbase users. On Saturday night, pseudonymous security researcher and SEAL 911 team member @pcaversaccio shared alarming details about a wave of account compromises. ”Yesterday skiddies (again) decided to fake Coinbase support and drained multiple accounts,” he posted on X.

The term ”skiddies,” short for ”script kiddies,” refers to inexperienced hackers who rely on prewritten scripts to execute cyber exploits rather than creating their own tools. These opportunistic attackers have increasingly targeted digital asset platforms, leveraging deceptive methods to trick unsuspecting users into revealing sensitive information.

In its thread on X, Coinbase acknowledged the heightened activity, attributing it partly to a significant influx of new and returning users post-election. ”Along with this surge, as is typical with surges, we’ve seen a 2-3x increase in fraudulent attempts,” the @CoinbaseSupport account wrote. Despite these challenges, Coinbase highlighted the effectiveness of its fraud-prevention systems, claiming they had saved customers ”tens of millions in losses in November alone.”

However, Coinbase’s efforts to combat fraudulent activities have not been without criticism. Users and security experts have voiced concerns over the exchange’s reliance on stringent account security measures, which some argue are overly sensitive and prone to false positives.

The VPN Debate: Balancing Security and Usability

Coinbase’s stance on VPN use has sparked particular controversy. In a Dec. 2 post, Scott Shapiro, Coinbase’s product director, explained that attackers frequently use VPNs, making them a potential red flag in the platform’s risk models. However, Shapiro clarified that VPN usage alone would not trigger account restrictions. Instead, it is flagged when combined with other risk factors, such as logins from unknown devices in unfamiliar locations attempting to transfer large sums of cryptocurrency.

Critics, including rival exchange Kraken’s chief security officer Nick Percoco, have pushed back against Coinbase’s approach. ”A VPN is your digital armor,” @pcaversaccio wrote, emphasizing its necessity for users who rely on public Wi-Fi or seek to protect their privacy. Percoco went further, suggesting Coinbase’s measures could force users to choose between financial freedom and personal safety.

Another point of contention has been Coinbase’s customer support. Users have reported delays in receiving assistance, exacerbating frustration over account restrictions and fraudulent activity. Taylor Monahan, principal security researcher at Metamask, critiqued Coinbase’s lack of weekend support, sarcastically remarking, ”Crypto operates 9-5 PT Monday-Friday, and no one victimizes your users outside those hours either.”

Coinbase acknowledged the challenges, admitting to a ”minor increase in restricted accounts and elevated CX wait times” due to the spike in fraud attempts. ”If you are restricted, we’re not ignoring you; we’re working hard to respond asap,” @CoinbaseSupport assured users.

While Coinbase maintains its systems are acting as expected, the platform's handling of the situation has drawn mixed reactions. Some users have praised its proactive fraud prevention, while others have expressed dissatisfaction with the lack of timely communication and perceived overreach in account restrictions.

The exchange’s challenges place the spotlight on the delicate balance between maintaining robust security measures and providing a seamless user experience. With the cryptocurrency market operating 24/7, platforms like Coinbase face mounting pressure to meet user expectations without compromising on safety.

Coinbase International Celebrates Milestone with 100th Perpetual Futures Contract Listing

In related news, Coinbase International has reached a significant milestone with the listing of its 100th perpetual futures contract. 

In a celebratory tweet, Coinbase International stated,  ”We’ve officially listed our 100th perpetual future on Coinbase International Exchange. That’s 100 unique opportunities for you to diversify, trade, and grow.”

This milestone is indicative of Coinbase's dedication to innovation in the derivatives space and its ongoing efforts to cater to a growing international user base seeking advanced trading options. However, Coinbase International is not stopping at 100. The exchange has announced the addition of four new perpetual futures contracts, which will be available starting Dec. 12. The new listings include:

• Moo Deng (MOODENG)

• Algorand (ALGO)

• The Sandbox (SAND)

• Mog Coin (1000MOG)

These listings will be accessible to traders on both Coinbase International Exchange and Coinbase Advanced, further broadening the range of assets available for trading.

Moo Deng is a Solana-based meme coin inspired by a famous Thai zoo hippo of the same name. Known for its quirky branding and community-driven appeal, Moo Deng has garnered significant attention in the meme coin ecosystem. At the time of writing, Moo Deng's price had dropped by 15.64% in the last 24 hours, reaching $0.4521.

Algorand stands out as a blockchain platform emphasizing energy efficiency and security. Its single-layer architecture is designed for instant transaction finality, high throughput, and low fees. ALGO, the native cryptocurrency of the Algorand blockchain, was trading at $0.482, down 3.24% in the last 24 hours.

The Sandbox is a virtual metaverse platform where users can create, own, and monetize gaming experiences using non-fungible tokens (NFTs). The SAND token serves as the ecosystem’s primary utility token. Over the past 24 hours, SAND suffered a drop of 5.02%, trading at $0.8751.

Mog Coin, an Ethereum-based meme coin, has captured headlines with its meteoric rise. Recently, it reached an all-time high of $0.000004, but has since settled at $0.000003761.

Coinbase International’s Growing Influence

The listing of the 100th perpetual futures contract marks a pivotal moment for Coinbase International as it strengthens its foothold in the global derivatives market. Perpetual futures, a key offering in the crypto trading space, allow traders to speculate on asset price movements without the constraints of an expiry date. This flexibility has made perpetual futures a popular choice among experienced traders.

Coinbase’s expansion into derivatives comes as part of a broader strategy to tap into the rapidly growing international crypto markets. By introducing diverse assets and advanced trading features, Coinbase aims to attract a more sophisticated trading audience while keeping up with competitors like Binance and Bybit, which dominate the derivatives market.

As Coinbase International continues to expand its portfolio of perpetual futures contracts, it signals a clear ambition to remain at the forefront of global crypto trading innovation. The introduction of new assets like Moo Deng, Algorand, The Sandbox, and Mog Coin demonstrate the exchange’s dual focus on supporting both established and emerging digital assets.

With an increasing number of traders turning to derivatives as a means of hedging and leveraging their positions, Coinbase’s proactive approach to expanding its offerings is likely to bolster its appeal among retail and institutional investors alike.

As the global crypto landscape evolves, Coinbase International's continued focus on expanding its offerings and improving user experience positions it as a key player in the competitive cryptocurrency derivatives market.