Wow, I bought some digital currency through coinbase last summer and while I had some annoyances with the transaction limits, high fees and the delays, overall, I think they did a good job considering how fast they were growing. I can't imagine how many fires they had to put out over there, and how hard it would be to recruit knowledgeable and talented people.
That said, the fact that I made enough money to get a new car rather than lost money probably skews my opinion.
As a Canadian customer, I was pretty steamed that I could buy coins, but they didn't tell me I couldn't sell them until after I'd already purchased. I managed to transfer to MetaMask so it ended up okay.
I can't tell if this is a genuine question or not, because if it's genuine you're giving the OP an extremely ungenerous reading. "They didn't tell me I couldn't sell them until after I'd already purchased" doesn't mean "I couldn't sell the coins until after I bought them, and I had no idea that was the case because I don't understand the basic concept of transactions." It means "I wasn't allowed to sell the coins, and they didn't tell me that until after I bought them."
In my opinion they did not put out most of their fires; they just let them burn, as I had multiple tickets that auto-response pretty much told me to fuck off and go to their FAQ look for answer, as they will most likely not answer at all (which was true)
Congratulation on your new car; Ethereum bonanza made it possible for me to purchase 6 properties around Palo Alto and be able to rent those out BUT, even if you made only some $ for a car, I strongly advise (probably you did this already) to seek a knowledgeable accountant help as Coinbase share all your info with IRS and I am sure they will be crushing big time (or already started) on those newly minted millionaires (and anyone in between!)
Congrats! I already reported all my short-term capital gains to the IRS. I'm not going to mess with tax dodging. I got the car with what was left over after taxes.
I've dealt extensively with Coinbase and second this opinion: Whenever I've communicated with employees they appear to be dedicated to resolving any issues in a fair and appropriate manner. However, various parts of their software platform have been glitchy and confusing UX abounds. Additionally, significant mistakes regarding balances on their end definitely happen: At times, they fall well short of their aspirations to provide a professional platform to customers.
I'd suggest the consumer help reporter on your local TV station. The Feds don't care. Why should they? It's not like this involves real currency or stocks.
> Wouldn't the Federal Trade Commission be the more apt generic regulator to lodge these complaints to?
The best strategy would involve papering many agencies. The CFPB, SEC, CFTC, OCC, your state financial services regulator and attorney general, et cetera. Generally speaking, the SEC is still deciding whether Bitcoin is in its purview. Lots of complaints could cause it to classify Bitcoin exchanges as being subject to the Exchange Act or 1934.
Coinbase needs some serious competition. Their site is fine, until you ran into a problem. I didn't have one, but from what I can see, once people run into issues, they are just not resolved, hence frustration.
With the exception of Kraken, Poloniex, and Gemini, I either haven't heard of these places or have heard nothing but terrible, terrible things (i.e., Bitfinex).
And I'm sure people have bad things to say about the ones I listed as not being that bad.
There simply isn't a well trusted exchange. Coinbase/GDAX and Kraken are the two I would recommend to people getting started, even with these issues surfacing.
Nope, wrong. Most people should prefer jurisdiction in their country of residence.
Most people will want the ability to sue them if something goes wrong. They will value that more than the vague theoretical threat of a government crackdown or avoiding taxes.
Anecdotal, but I quite like Gemini. Coinbase deactivated my account without cause so I moved to Gemini and TBH they seem to take compliance much more seriously. I still don't store money on there, but out of all the exchanges I've worked with over the years, Gemini feels the most secure.
I know several good people that have been locked out of Coinbase permanently - without any explanation of why - for over a year despite repeated unanswered requests to have accounts reinstated. I watched those people turn from advocates for coinbase into critics. Just a simple explanation would have helped prevent that scenario.
This company is a terrible example of how to do business. It's as if they watched how Google handled AdSense publishers in the early days and decided to copy that model for customer service.
The first two sentences of the Bitcoin whitepaper:
> A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required...
While I could still login to my account, I was unable to deposit/withdraw any usd/crypto. After repeatedly attempting to contact coinbase support for months, I never got any further than automated responses or if I was lucky "We'll look into it" (that was never followed up on).
Perhaps with the recent spike in interest in cryptocurrency, coinbase is more concerned with institutional customers who are depositing 5+ figure amounts frequently, and no longer have any interest in people such as myself who only occasionally deposit $100 or so.
To add to sister comments, I'm also one of these people.
My account became re-locked behind a 2 factor validation step, at some point, asking me for a token they claimed to have sent me. Asking to resend results in a server error. I went through 3 support ticket trains before I got "blacklisted." All 3 support agents stopped responding eventually, and after the third, I never got another response back to an initial bug (made with ~1 month increments). This was ~ a year ago.
I made similar posts in the past and will echo the sentiment now. Coinbase is a fantastic example of how we've gotten into this state of the world where businesses, including ones touching the most sensitive aspects of your life (financial, private communication, private data storage) have almost no accountability to their users if you fall under their "not enough to care" epsilon. Unfortunately, that epsilon was likely derived by looking at the impact of failed tickets, so I'm pessimistic there will _be_ an impact. If there was, they'd be incentivised to change their behavior.
I'll say this in every Coinbase thread: They did this to me, then I contacted the CFPB -- it's quick and painless via their website -- and within a couple of days Coinbase's support team became coincidentally responsive again. I got my money back quickly.
I was surprised because I'm 1) a cynic, and 2) not a US citizen. But it worked!
This is a settlement problem. Coinbase is unable to settle money between different accounts. And there is a perfect solution for this. We can use blockchain....Oh Wait. /s
On a serious note, building a production level real time two book entry system is hard. Many times money just disappears because both legs of transactions don't match. The only way to track is some real good amount of sleuthing. But given the amount of customers Coinbase is adding left and right, it might be difficult to find time to get down to this sleuthing.
It would have been best for Coinbase to temporarily hold new accounts to get their shit together. But I guess lure of money from constant trading was too much.
On the one hand, it's hard to scale a system without making it distributed at some point and consistency in distributed systems is really difficult; the system Coinbase is running is definitely not as straight forward as whatever you've been reading about. On the other hand, this is their core competency and it is absolutely not acceptable for money to go missing; it's a tough problem but its their business and they have to make it work or they're in for major trouble.
> On the one hand, it's hard to scale a system without making it distributed at some point and consistency in distributed systems is really difficult
Banks have scaled systems like this with mainframes and COBOL for decades. It's probably not as hard as you think to get it right if you have your priorities straight.
IMHO, for banking, you need to KISS and avoid all unnecessary complexity (especially in the name of "scale"), at least for your master source of truth.
What I think computer programmers tend to ignore are principles of real engineering in classical, high-consequence fields. It seems like Coinbase has been following the mantra of "move fast and break things," that would absolutely horrify any traditional engineer. Any civil engineer reviewing a bridge, any aerospace engineer designing a passenger aircraft that he himself may to have to fly on. When the work gets serious, it's time to move slowly and fix things. "Move fast and break things" is antithetical to any form of engineering.
Well, remember, we work in an industry managed by people who are convinced that programmers spend all their time browsing facebook and playing fortnight and develop "give me one good reason why I shouldn't fire you right now" methodologies like Scrum and "always looking over your shoulder" open offices. Working slowly, deliberately, and safely is indistinguishable from slacking to people who do nothing except look for slacking.
I lost access to my Coinbase account when I lost my phone and got locked out due to 2FA. This was partially my fault for not being careful enough and not saving the recovery code.
Anyway, they told me to create a new account. Their team would then verify that both accounts are matching, as you have to submit a copy of your passport. The funds would then be transferred from the old locked-out account to the new account.
I did all this over 2 months ago. I am still waiting for the funds to be transferred. I contacted support twice now, and I'm always getting the same reply (we're still working on it).
Fortunately, due to a mistrust of exchanges, I only have a small portion of my crypto-assets on Coinbase and keep most of it offline. However, it's still a non-trivial amount of money. I'm not sure what extra steps I can take now without it being too much effort on my part, because the amount is not that high.
I operate an adult comic book publisher and Coinbase shutdown our account without notice and blamed the bank they work with (despite the fact that we were not converting our BTC to USD). All support tickets took 3 - 5 weeks to get a reply and it was always unhelpful.
For a company like ours the whole appeal of Bitcoin is the anonymity, so our readers don't have to worry about buying lewd comics and having it show up on their statements. Coinbase tarnishes what Bitcoin stands for and they do not protect artists/publishers.
If you weren't converting to USD, why use Coinbase at all?
I understand there might be a convenience factor for managing the BTC transaction, but there are many options for doing so that don't introduce such a liability.
> For a company like ours the whole appeal of Bitcoin is the anonymity, so our readers don't have to worry about buying lewd comics and having it show up on their statements.
Might I suggest Monero? That way if your customers use Bitcoin for other things, others can't see the details of your customers' transactions with you.
If you don't convert into USD, there are different plugins that allow you to collect the coins, if you do want to convert there's a service called Globee that also takes BTC as well as XMR.
There's a law firm taking complaints against Coinbase and wrapping them up into a class action.[1] PACER shows multiple lawsuits against Coinbase. Arbitrations are confidential, but there are probably some of those, too; Coinbase puts an arbitration clause in their contracts.
Arbitration clauses don't prevent a lawsuit where there is fraud. One of the cases against Coinbase was forced out of arbitration because of that.
I could see a small firm offering one-on-one, high value cryptocurrency-to-cash-and-back transactions doing very well. They could jump through all the money exchange and KYC hoops just like Coinbase did, but offer top-shelf, direct service.
I have said it before. I will say it again. Coinbase is a bad player in crypto world. It is a magnitute worse than PayPal during its blackhat days of freezen assets. Their license needs to be revoked yesterday and not SEC but FBI needs to be involved.
Here's a non-nonsensically opaque mail I recently got. Blocking early-adopters and developers won't go well. Infuriating.
Hello,
Thank you for your interest in Coinbase. Our primary goal is to make digital currency safe and secure for our customers. Coinbase is a regulated Money Services Business under FinCEN (FinCEN.gov), and as part of achieving this goal, we are legally obligated to implement regulatory compliance mechanisms.
Upon careful review, we believe your account has engaged in prohibited use in violation of our Terms of Service and we regret to inform you that we can no longer provide you with access to our service. We respectfully request that you follow the on-screen instructions presented when you log into your Coinbase account to send any remaining balance offsite to an external address.
Should you have any questions or need assistance, please let us know and we'll be happy to help.
Respectfully,
Coinbase Customer Support
And the follow up:
Hello,
Thank you very much for your phone call about your account restriction.
There are a variety of factors which have been weighed in your case, and we unfortunately are unable to elaborate on our internal decision process. Please know that we do not make these decisions lightly, and do regret losing you as a customer.
We wish you all the best in your future endeavors. If you have any additional questions, please reach out to us by directly replying to this thread.
Regards,
The Coinbase Team
really skeptical. seems like never ending FUD. majority of the cases are customers that lost keys or did something wrong. For sure coinbase is not scamming people because they don't have to!
Personally I've used Coinbase since 2013 and apart from a couple transactions (in 2013) getting flagged for fraud and reversed I haven't had any problems. Despite whole bunch of personal horror stories, I don't think they are a malicious, just unprepared for last year's massive usage spike.
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68 comments
[ 2.8 ms ] story [ 148 ms ] threadThat said, the fact that I made enough money to get a new car rather than lost money probably skews my opinion.
Why would that not be the case?
Congratulation on your new car; Ethereum bonanza made it possible for me to purchase 6 properties around Palo Alto and be able to rent those out BUT, even if you made only some $ for a car, I strongly advise (probably you did this already) to seek a knowledgeable accountant help as Coinbase share all your info with IRS and I am sure they will be crushing big time (or already started) on those newly minted millionaires (and anyone in between!)
https://www.theverge.com/2018/2/26/17055264/coinbase-cryptoc...
Coinbase doesn't trades securities, and had not even registered as a broker-dealer at the time of any of these complaints.
Wouldn't the Federal Trade Commission be the more apt generic regulator to lodge these complaints to?
"You pays your money, you takes your chances."
According to the US Treasury Dept. it's a currency.
The best strategy would involve papering many agencies. The CFPB, SEC, CFTC, OCC, your state financial services regulator and attorney general, et cetera. Generally speaking, the SEC is still deciding whether Bitcoin is in its purview. Lots of complaints could cause it to classify Bitcoin exchanges as being subject to the Exchange Act or 1934.
more like rationalizing HOW
Preferably before January 20, 2017
And I'm sure people have bad things to say about the ones I listed as not being that bad.
There simply isn't a well trusted exchange. Coinbase/GDAX and Kraken are the two I would recommend to people getting started, even with these issues surfacing.
Most people will want the ability to sue them if something goes wrong. They will value that more than the vague theoretical threat of a government crackdown or avoiding taxes.
Coinbase uses MongoDB, doesn't it? Asking for a friend.
This company is a terrible example of how to do business. It's as if they watched how Google handled AdSense publishers in the early days and decided to copy that model for customer service.
I wonder how well that strategy will play out.
> A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. Digital signatures provide part of the solution, but the main benefits are lost if a trusted third party is still required...
I'm genuinely curious. I suppose it depends on the ultimate goal, but seeing as Coinbase is VC-funded, well...
While I could still login to my account, I was unable to deposit/withdraw any usd/crypto. After repeatedly attempting to contact coinbase support for months, I never got any further than automated responses or if I was lucky "We'll look into it" (that was never followed up on).
Perhaps with the recent spike in interest in cryptocurrency, coinbase is more concerned with institutional customers who are depositing 5+ figure amounts frequently, and no longer have any interest in people such as myself who only occasionally deposit $100 or so.
My account became re-locked behind a 2 factor validation step, at some point, asking me for a token they claimed to have sent me. Asking to resend results in a server error. I went through 3 support ticket trains before I got "blacklisted." All 3 support agents stopped responding eventually, and after the third, I never got another response back to an initial bug (made with ~1 month increments). This was ~ a year ago.
I made similar posts in the past and will echo the sentiment now. Coinbase is a fantastic example of how we've gotten into this state of the world where businesses, including ones touching the most sensitive aspects of your life (financial, private communication, private data storage) have almost no accountability to their users if you fall under their "not enough to care" epsilon. Unfortunately, that epsilon was likely derived by looking at the impact of failed tickets, so I'm pessimistic there will _be_ an impact. If there was, they'd be incentivised to change their behavior.
I was surprised because I'm 1) a cynic, and 2) not a US citizen. But it worked!
On a serious note, building a production level real time two book entry system is hard. Many times money just disappears because both legs of transactions don't match. The only way to track is some real good amount of sleuthing. But given the amount of customers Coinbase is adding left and right, it might be difficult to find time to get down to this sleuthing.
It would have been best for Coinbase to temporarily hold new accounts to get their shit together. But I guess lure of money from constant trading was too much.
Each transaction has an ID and a user ID, how does money disappear?
Banks have scaled systems like this with mainframes and COBOL for decades. It's probably not as hard as you think to get it right if you have your priorities straight.
IMHO, for banking, you need to KISS and avoid all unnecessary complexity (especially in the name of "scale"), at least for your master source of truth.
I got locked out of coinbase and 2 months later BTC went up 2.5x.
Thank god because I was going to sell 2 BTC. Only ended up needing to sell 0.5 + 3 shitcoin cash.
I mean it's on the BLOCKCHAIN, right?
Anyway, they told me to create a new account. Their team would then verify that both accounts are matching, as you have to submit a copy of your passport. The funds would then be transferred from the old locked-out account to the new account.
I did all this over 2 months ago. I am still waiting for the funds to be transferred. I contacted support twice now, and I'm always getting the same reply (we're still working on it).
Fortunately, due to a mistrust of exchanges, I only have a small portion of my crypto-assets on Coinbase and keep most of it offline. However, it's still a non-trivial amount of money. I'm not sure what extra steps I can take now without it being too much effort on my part, because the amount is not that high.
For a company like ours the whole appeal of Bitcoin is the anonymity, so our readers don't have to worry about buying lewd comics and having it show up on their statements. Coinbase tarnishes what Bitcoin stands for and they do not protect artists/publishers.
Do not use Coinbase.
I understand there might be a convenience factor for managing the BTC transaction, but there are many options for doing so that don't introduce such a liability.
Might I suggest Monero? That way if your customers use Bitcoin for other things, others can't see the details of your customers' transactions with you.
If you don't convert into USD, there are different plugins that allow you to collect the coins, if you do want to convert there's a service called Globee that also takes BTC as well as XMR.
Arbitration clauses don't prevent a lawsuit where there is fraud. One of the cases against Coinbase was forced out of arbitration because of that.
[1] https://www.silvermillerlaw.com/current-investigations/coinb...