Coinbase Cyber Heist: Company to Reimburse Victims, Offers $20M Bounty

Coinbase (COIN.O) estimates a loss between $180 million and $400 million due to a cyber attack that compromised account data of a small number of its customers, causing a 3% drop in the company’s shares during premarket trading on Thursday. 

Coinbase firm reported receiving an email from an unidentified threat actor on May 11, who claimed to possess information about specific customer accounts and internal documents. 

This announcement comes just days before Coinbase is set to be included in the S&P 500 index (.SPX), a significant milestone for the cryptocurrency sector. Coinbase stated that while some data, including names, addresses, and emails, was stolen, login credentials and passwords were not accessed. 

The company will reimburse customers who were deceived into sending money to the attackers. The hackers had employed several contractors and employees in support roles outside the U.S. to gather information from internal systems, leading to the immediate termination of those involved. 

Coinbase has declined to meet the $20 million ransom demand and is collaborating with law enforcement, while also offering a $20 million reward for information about the attackers. 

“Instead of funding criminal activity, we have investigated the incident, reinforced our controls, and will reimburse customers impacted by this incident,” the company said in a blog post.

Security continues to be a major concern for the cryptocurrency industry, as evidenced by Bybit’s February disclosure of a theft of digital tokens valued at approximately $1.5 billion, which was labeled the largest crypto heist ever. 

According to a report from blockchain analysis firm Chainalysis, hacking incidents targeting crypto platforms resulted in $2.2 billion in stolen funds in 2024, marking the fourth consecutive year that such hacks exceeded $1 billion.

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