$45 Million Embezzled from Coinbase Users during Weeklong Fraud Spree reported by ZachXBT
In the rapidly evolving world of cryptocurrency, major platforms like Coinbase are under growing scrutiny for their handling of user protection, transparency, and response times in the face of evolving threats. This scrutiny has intensified following reports of significant user losses due to social engineering scams.
Recent investigations by blockchain investigators such as ZachXBT and Nathan have revealed that Coinbase users have lost over $300 million annually due to these scams. These scams typically involve attackers manipulating users or impersonating customer support to gain access to sensitive information, leading to substantial theft of funds.
One such instance occurred in August 2025, when a victim lost $91 million worth of Bitcoin after falling for a scam where support staff of both the exchange and a hardware wallet were impersonated. Another significant breach in May 2025 highlighted vulnerabilities: criminals bribed Coinbase’s offshore contractors and obtained sensitive user data, putting about 69,000 users at risk of social engineering attacks. This breach allowed scammers to steal around $45 million from Coinbase clients within a week by posing as exchange support and coercing victims into transferring funds.
In response to these concerns, Coinbase has taken several measures to improve user protection. These include making phone numbers optional for advanced users who are fully verified and have stronger authentication methods, creating a beginner or elderly user account type with restrictions, enhancing community outreach, considering legal action against data brokers, and improving operational security. The company has also compensated affected victims who lost funds due to the data leak.
Customers are urged to remain vigilant, treat unsolicited contact as potentially fraudulent, and independently verify communications to avoid falling victim to such scams. The crypto community continues to express support for the concerns raised by investigators like ZachXBT and Nathan, with many sharing their own thoughts and experiences.
These recent events have increased concerns about the management of user protection, transparency, and response times on major cryptocurrency platforms. The SEC's recent decision to drop a lawsuit against Coinbase and issue a joint stipulation agreement may provide some relief, but the platform still faces challenges in restoring user trust in the cryptocurrency market.
Security concerns persist within the cryptocurrency market as major platforms, such as Coinbase, grapple with maintaining user protection in the face of evolving threats. Reports of user losses due to social engineering scams have led to a $300 million annual drain, as revealed by blockchain investigators like ZachXBT and Nathan. To combat this, Coinbase has implemented measures like optional phone numbers for advanced users, creation of user account types with restrictions, and enhancing community outreach, yet concerns about transparency and response times remain. The SEC's decision to drop a lawsuit against Coinbase may offer some reprieve, but restoring user trust and ensuring financial security in the cryptocurrency market continues to be a significant challenge.
