• Coinbase user Jared Ferguson lost $96,000 due to account draining after receiving an SMS prompt message.
• Coinbase denied responsibility for missing unauthorized transactions and refused to reimburse the customer.
• Coinbase recently launched Base Layer-2 blockchain with transaction monitoring in compliance with the regulators.
Coinbase Refuses to Reimburse Lost Funds
A Coinbase user, Jared Ferguson from New York, has filed a lawsuit against the encryption exchange after losing $96,000 in encrypted assets due to a security breach. The hacker drained the plaintiff’s account 24 hours after he received a text message prompting him to change his password. Despite this, Coinbase failed to flag multiple unauthorized transactions during that period. As a result, the victim’s life savings were wiped out without reimbursement from Coinbase.
Coinbase Denies Responsibility
In response to this incident, Coinbase sent an email stating that it is not responsible for any losses stemming from security breaches and that customers are solely responsible for their own accounts and passwords. Furthermore, similar cases have occurred in 2021 where users had lost considerably smaller amounts of money but were also refused reimbursement by Coinbase.
Crypto Twitter Roasts Coinbase
Unethical practices like this have often made Coinbase customer support the target of Crypto Twitter’s ridicule and criticism. In addition, these issues have caused a decline in its stock price; at press time, it was priced at $62.77 with a 2.7% decrease in 24 hours.
Coinbase Launches Base Layer-2 Blockchain
In order to address regulatory concerns surrounding transaction monitoring as well as other security measures, Brian Armstrong announced that he would be applying such features into their new Base Layer-2 blockchain technology which was recently released by Coinbase.
It remains unclear whether or not Jared Ferguson will receive his much needed reimbursement from Coinbase despite filing suit against them back in May 2022; however it is clear that the company intends on taking further steps towards improving security measures in order to protect its customers better going forward.
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