Coinbase seems to be going to great lengths to try and distance themselves from the so-called "rogue overseas support agents".
If they were Coinbase employees or contractors, that means the company basically sold its own data to hackers, who then turned around and demanded a ransom.
Reimbursing duped customers makes sense, as it seems like they would have a pretty straightforward case to make in court that Coinbase's actions led to their loss.
I'm more curious if someone who feels the need to move, change banks, change their email, hire a security detail etc. could successfully sue the company to recover some or all of those costs.
I have been receiving regular spear phishing calls from these guys, or someone who bought the leaked data, with classic tactics like claiming that I need to confirm a potentially fraudulent transaction. They speak perfect English with an American accent, sound very friendly, and have knowledge of your account balance. Thankfully on the first call I realized it was a scam right away, and Google's call screening feature takes good care of the rest. Wish I could forward them to Kitboga[1].
I guess they didn't have as much luck as they wanted scamming Coinbase's customers, and once they had their fun they decided to try extorting Coinbase themselves.
If you had any significant assets on Coinbase at any time prior to this breach, spear phishing is the least of your worries.
Coinbase not only leaked your full name and address, they also gave up your balances, your transaction history, and images of your government identification.
People with "significant" crypto balances are being assaulted on the street and in their own homes, and family members are being kidnapped for ransom.
"Significant" in this case can be $10k or less.
Until now, your best defense secrecy. Never talk about crypto in public in any way that could be traced to your real-world identity.
Thanks to Coinbase that defense is now gone.
The bad guys can see who has ever had a significant balance on Coinbase (even if they don't right now), whether that balance was sold for cash and how much, or if you've ever transferred tokens off the exchange to a self-custody wallet.
Now the bad guys know who's worth kidnapping for ransom and where you live. For most people, a Google search of your name and home address turns up the names of family members who would would also be lucrative targets for kidnapping and threats of violence.
Coinbase will never be forced to reimburse all the damage they've done because the true cost would bankrupt the company.
But hey, at least by being forced to give crypto exchanges all our personal details we're all super protected from the four horsemen: money laundering, drugs, terrorism and pornography.
> People with "significant" crypto balances are being assaulted on the street and in their own homes, and family members are being kidnapped for ransom. "Significant" in this case can be $10k or less.
I wonder why, select a person completely at random and by median you'll get just as much from what they have sitting in their checking account. Select a nicer area for an order of magnitude more. That's not encouragement to go assault people in their homes or kidnap families... just confusion.
Yeah, but banks and the normie monetary system has a lot more safeguards in it when it comes to account transfers. Or at least, they appear to have them.
The median person does not have $10k sitting in a checking account that they can easily withdraw. My gut feeling is that the threat of kidnapping is a lot more serious in some countries. The US maybe not so much.
Good point, perhaps the lower $ examples are about other countries where that may be a lot more than median transactional account holdings and maybe that concern is part of why folks were using crypto holdings.
It’s my biggest gripe. They can pretty accurately flag a number as Spam or Telemarketing but in the “Silence Unknown Callers” setting I can only silence every single unknown caller. I can’t silence every single number that’s not in my contacts. When the plumber calls to confirm he’s in route, my phone needs to ring. Stuff like that.
iphone has been enshittified for several years now, it seems apple engineers are not using their own phones any more. I can understand it - when you're a millionaire just from your corporate job you won't be a stressed power user of your own iphones.
Sometimes you need to answer calls from unknown numbers.
Google's call screening feature picks up the phone before it rings and asks the caller why they're calling. If they actually give a good reason, then it shows you the reason as text and you can decide whether to hang up on them or answer. https://support.google.com/phoneapp/answer/9118387
Yeup, I finally broke down went from Android -> IPhone 16 Pro. I like a lot about Apple's personal security policies for their consumers vs Google, but damn, I miss google's automatic call spam detection and management. All day long my Apple phone rings, and I just have to ignore the calls.
iPhone user here. I put on airplane mode unless I'm making or expecting a call. Otherwise, I make it clear that email is my primary form of communication.
Oh yeah I get the Microsoft account emails, and Instagram ones, randomly (I have an account but never use it). I'm pretty sure SMS 2FA is turned off on my Coinbase account, which is highly recommended.
Scams have gotten better since AI. Most of the common spelling mistakes are gone.
I was looking through some phishing e-mails the other day out of curiosity and found a weird unicode character mistranslated. Immediately knew it was an artifact of bad translation. So they're not perfect, but they're damn good.
I tried to reach out to coinbase customer support to see if I was impacted. Once I wasted my time with the AI bot and got a human they were unaware of the breach. I was the first person to inform them about it.
The "Important Notice" I got says "This included information related to your account". Also I got an email earlier on April 1 about a breach that sounds very similar if it's not the same one.
I see "We wanted to let you know that we detected activity suggesting that information related to your account may have been accessed in a way that did not align with our internal policies." in the email i got this morning
I'm having de ja vu here. If they only found out when they attempted to extort them does it mean they don't even bother to log employee access? Is there any means for accountability at all internally?
It would be so simple to have access tracking and flag or lock out rogue employees... I look forward to seeing what the golden parachutes look like.
Logging and retroactive auditing seems like the very least they should do. Even asking the customer service agent to first provide identifying details of the customer they can't easily know or guess by themselves doesn't seem excessive, given the sensitivity of the information.
It won't work for 100% of all calls (what if the customer is locked out themselves etc.), but those calls can then be handled by even more closely monitored agents.
"Less than 1% of monthly transacting customers" means up to 1% were accessed – that seems very high, i.e. much higher than the number of customer service contacts I'd expect.
The problem is that it seems like the data that leaked is also the data that would be used to do account recovery.
And what that means is that
1) If you lose access to your account (through either your own fault, or coinbases fault) that the process of recovering it may not be so straightforward anymore.
2) Hackers can try to “recover” accounts now using this leaked info.
This is a huge problem. What coinbase needs are IRL offices where you can go and do things like account recovery, and where people trying to steal money can be caught and prosecuted (and makes a huge barrier for the overseas thieves who are usually doing this)
The only solution here is: hardware 2 factor like yubikeys.
One that I'm using does, but I find it extremely annoying when they have me go to a branch to unblock my account that they locked due to a poorly calibrated risk system (that they need due to not supporting actually secure 2FA methods).
Coinbase is identical to a bank because it holds customer funds. Your comment isn't quite the dunk you think it is. Blockchains allow money to be held anonymously without any banks involved. Centralized exchanges are just profiting on speculation and probably should be banned.
My money in the bank in case of fraud is protected unless I voluntarily gave the fraudster my money. If a bank goes bankrupt, my money is protected by the government
> What coinbase needs are IRL offices where you can go and do things like account recovery, and where people trying to steal money can be caught and prosecuted
People getting locked out of their account (which can happen due to no fault of the user, e.g. by an overly nervous risk system) will be really happy to have to potentially travel to a different city to regain account access...
> What coinbase needs are IRL offices where you can go and do things like account recovery, and where people trying to steal money can be caught and prosecuted
> What coinbase needs are IRL offices where you can go and do things like account recovery, and where people trying to steal money can be caught and prosecuted (and makes a huge barrier for the overseas thieves who are usually doing this)
Cryptocurrency firms exist in a quantum superposition of bank and not-a-bank until you interact with them, at which point they collapse into whichever state costs them less money.
lol they even do fractional reserve things like banks, except they're more shady and don't acknowledge it, now I'm either connecting dots that shouldn't be connected or some withdrawal locks that happened through some big arbitrage opportunities were very suspicious.
Watching crypto enthusiasts run into every problem that society already tackled with in the past when developing currency and its controls, and then coming up with solutions that look exactly the same as what dirty fiat currency uses, has been a source of much entertainment the past few years
But they need exchanges to get real money to flow in and out of cryptocurrency easily. Without it, cryptocurrency by itself would likely be worth far less than it is today.
Yes that's true, but no need to hold your crypto there as a permanent storage. Once your fiat is exchanged to crypto, immediately transfer the crypto to your private wallet.
Yes, I think I’m familiar with the crypto enthusiasts defenses that all boil down to looking at a single aspect of their system in a vacuum and not realizing that if anyone wants to functionally use crypto as a currency and not as a speculative asset or tool in crime, then all these aspects actually have to work and work together
I don't really care about crypto personally (volatile shitcoins) but I think that's a straw man argument. They all know it gets troublesome when it comes to dealing with fiat transactions. The hardcore crypto enthusiasts want to avoid fiat entirely.
If only hardcore crypto enthusiasts who didn't want any fiat had cryptocurrency bitcoin would be worth a couple dollars a piece and 99% of other cryptocurrencies wouldn't exist. The vast vast majority of people who have crypto are doing it because they think they can get rich from it and that's why anytime it's talked about it's talked about in terms of fiat values
As I understand, the root of the problem is that Coinbase kept lot of sensitive information, including photos of IDs. If Coinbase was fully anonymous, and didn't require any KYC, the impact of the leak would be insignificant because it would be difficult to link user number 12345 with some real-world person.
So if we want to constrain impact of such attacks, we must make companies keep less data and delete them faster. For example, instead of storing a photo of ID, store just a checkbox that the person showed their ID and it was valid.
This applies not only to cryptocurrency, but to any company like Google, Uber, Amazon etc - if they didn't keep extra data, there would be little value in the leaks.
So the blame is not at cryptocurrency, but on companies not wishing to delete the data and governments demanding them to collect the data not necessary for operation. It's the government and capitalists who create problems out of nowhere.
> We will reimburse customers who were tricked into sending funds to the attacker due to social engineering attacks. If your data was accessed, you have already received an email from [email protected]; all notifications went out at 7:20 a.m. ET on 5/15 to affected customers.
The no-reply is an interesting decision. I get how difficult it is to run a company like Coinbase (their biggest strength, centralized + customer support, is also what enables this social engineering), but feels like an odd choice.
Their "customer support" includes not expecting users to set up PGP to communicate with them. Email is not a secure method of communication by default.
It's fine to send a notification instructing them to visit the secure portal for more info, though. Hence, no-reply.
no-reply is a good practice. No business should ever encourage their customers to reply to the emails they are sending out. That's what scammers do.
To contact the company you should go to company website at the address you know (which shouldn't be given in email as well), log in and send a message through internal message system, possibly referring to the email that you recieved through a random code (those can be auto-suggested if they recently tried to contact you by email).
If you do anything else your communication knwowingly mimics communication of a scammer.
Unrequested email should always only be one way communication. Email is too untrustworthy for it to be anything more.
> No business should ever encourage their customers to reply to the emails they are sending out.
It’s fascinating that we keep creating new technology and then find out that in practice most of it cannot be trusted. Which means it cannot be used for anything serious.
> No passwords, private keys, or funds were exposed and Coinbase Prime accounts are untouched.
I'm curious why no Coinbase Prime accounts were part of the leak (assuming that's what they mean). Is there some sort of additional layer of data protection behind the Coinbase Prime paywall? Or perhaps those accounts were intentionally avoided as they would presumably belong to more savvy users.
Coinbase Prime is its own exchange with its own support (actual humans in the USA that are available to chat to). It's for "institutional investors" so unavailable to most customers without the proper credentials/paperwork. They don't share the same outsourced "support" as the regular exchange, which appears to be the attack vector here.
> recruited a group of rogue overseas support agents
Why not just say what country the are from and how they hired them to start with. It's presented as those sneaky "overseas" people that somehow got access to our systems. This company makes what, a few billions in revenue but they couldn't vet and hire the right people?
And the reason Coinbase has to keep all that sensitive stuff, much more than what would be required to identify and authenticate you, which you hope will never be stolen, is because of know your customer laws, so you can thank your government that pictures of your passport got stolen and for whatever criminals and rogue Coinbase employees do with that info.
There are very good reasons for KYC, the problem here is not the government regulation, it's once again private companies being sloppy with their customer's data because sloppy is cheap and it's not their info on the line, it's yours, so there's little motivation for them to safeguard it _unless_ they're compelled to do it by law.
The people who designed a government regulation to deputize private companies couldn't possibly have known how sloppy private companies are with other people's data?
They could have designed KYC to minimize long-term storage requirements etc at some cost to what they could enforce, but a government like the US is inherently sloppy with the rights that are reserved for parties besides itself.
> Instead we are establishing a $20 million reward fund for information leading to the arrest and conviction of the criminals responsible for this attack.
I’m not usually a huge fan of crypto folks, but I applaud this.
I hope they are serious about paying the reward, and aren’t planning to rug-pull it.
It might not be a bad idea for the various crypto exchanges to pool their resources into a non-denominational security organization. It could offer hardening services, and some kind of accreditation.
It would also make many Ponzi schemes easier to spot, as they wouldn’t want to contribute.
Whatever you think of Coinbase, this is a pretty good response IMO:
> and will not pay the $20 million ransom demand we received. Instead we are establishing a $20 million reward fund for information leading to the arrest and conviction of the criminals responsible
I love it. This also would have been a great opportunity to break out of corporate speak for a moment for a good “Up yours hacker assholes!” Even us folks in the Bible Belt appreciate a well timed swear word here and there.
I’d say the better thing for customers would be to pay the ransom demand and get the PII back. If they want to fund a reward scheme too, well great, but if it were my data, I’d care more about Coinbase limiting the breach of the data, not playing around with retaliatory rewards.
There is no guarantee that an anonymous criminal is going to hold up their end of the agreement. Coinbase has no idea who they're negotiating with or where that data has been shared.
That, and they're reimbursing customers who were tricked.
In addition, paying the ransom would be an open invitation for everybody else to try the same attack, with the net result that all customers are less secure in the long run.
There should be an ISO standard with respect to how much power and information that front line customer support agents have. The more information you need, like changing passwords or accessing personal information, should get forwarded to higher level customer support agents with better training and more monitoring. This way you can design customer support experience with as little exposure to security issues as possible.
The CS reps are based in a LCOL country so the opportunity for theft is simply incredibly lucrative.
What is really needed, is customer-in-the-loop for access to their data. The problem is, not all accesses would make sense. Doing analytics over the data of the top 1% of customers, for example, requires some level of access, but would freak out those customers if they had to approve it.
What about, for example, a higher-tier support person performing QA over someone else’s work? What about DFIR teams doing research on potential abuse? Etc etc.
They main defense against internal attacks is bookkeeping. Banks have been dealing with this for thousands of years. I recommend the corresponding chapter in Security Engineering by Ross Anderson: https://www.cl.cam.ac.uk/archive/rja14/Papers/SEv3-ch12.pdf
Maybe it’s a naive question, but in many breach reports I see things like 'No passwords, private keys, or funds were exposed.' How come companies can usually protect that kind of data, but not emails, names, and other personal info?
Companies want the ability to use things like emails, names, and other data for user experiences (go to settings, see name and change it), advertising (target this address book for X ad), etc. So these are typically plaintext (oversimplified) and accessible by different systems while passwords or private keys have one use case only and can have a higher bar of protection.
Such data is typically encrypted and purely write-only, only read by the system itself. Thus it is only exposed if the database itself is exposed. If the leak was compromise of the systems that access the data (which appears to be the case here--insiders copied data they could access) the write-only info is not exposed.
A properly implemented login system will never store a password in the first place. Properly hashed passwords can still be cracked in some cases, but if your password is strong and the hash is good, it’s safe.
So obviously he's not the bad guy here, since his hood is down. :)
Yet he's a bit urban edgy here, and the staging is like it's an impromptu social media reaction to some online slight. (though reading a script)
You don't want to go full South Park "We're sorry", but I'd feel better about a response in a business dress shirt, out of respect for wronged customers.
With a bit more humbled posture.
IMHO, you're answering to customers you've wronged, and you don't wear a hoodie to church nor court (nor do you play video games during a live TV interview), nor do you assert superiority over the people you let down.
You can convey respect and humility, while also conveying being capable of responsibly resolving the problem.
(Just one person's reaction. I see some things the video did right, IMHO, but some other things jump out as wondering why they did that.)
So this is probably why the phishing calls have increased from ~1 per month to ~3 per week.. good to know... Wish coinbase would let me DO something about it... Maybe fresh accounts for everyone? Maybe KYC data not directly linked to accounts? There should be SOMETHING they can do because the sheer volume of people constantly harassing CB customers is nuts.
When i get those calls, i usually tell them “why dont i just save everyones time and just give you my bank account number, password and social security number? That sound good?”
The article says they sent an email, but I usually ignore emails from Coinbase. I hope there's going to be a better way to find out if your data was breached. I was locked out of my account before, and had to upload an ID. I thought they didn't store it... :o
I’ve been getting scam texts from scammers who claimed my Coinbase account was compromised and to contact them. I wonder if this incident was the root cause
I wonder what percentage of Coinbase's (but also any other company storing PII data) support is done by AI at this point, and whether they could focus on and invest much more heavily to make that as close as possible to 100%.
>On April 12, Coinbase updated their user agreement to take effect TODAY, May 15, with new language about waiving some rights to class action lawsuits and jurisdiction selection.
Also, "Coinbase had detected the breach independently in previous months", aren't they required to disclose this? In the EU they are: Every EU institution must do this within 72 hours of becoming aware of the breach, where feasible
What they got
- Name, address, phone, and email
- Masked Social Security (last 4 digits only)
- Masked bank‑account numbers and some bank account identifiers
- Government‑ID images (e.g., driver’s license, passport)
- Account data (balance snapshots and transaction history)
Wow. Why does customer support staff have access to images of the user's passports?
I also like 'last 4 digits only' as if that's not the most important parts and the part so many places use to validate your identity, the first 5 are just area and group so they're not exactly random.
Everyone's social security number is available. If you go download the leak referring to in this HN post [1], your SSN is certainly in it. Mine was, everyone in my family's was, almost all of my friends' were.
The world needs to stop pretending that SSNs are secret. They aren't.
Who else would verify the user passports if not the customer support staff? Who verifies (and photocopies! in Asia and Europe) your passport at a hotel or car rental office?
All KYC processes require copying in Europe. There's nothing that's blanket illegal under GDPR. If you have consent you can collect and store whatever you want.
The odds are already against their future viability after a breach like this and if they're fumbling the response this bad it really doesn't bode well for them.
They would have been better off not even bringing up their location if they weren't going to be transparent.
Which is such a lame and flawed mechanism to avoid letting them access anyone's data. I mean what are you even trying to prove here? That banks care about customer's security when they can't even implement a secure 2FA which is not just an unencrypted text message
“Give a man a gun and he can rob a bank, but give a man a bank, and he can rob the world.”
CS can validate without knowing the details, the same way you don't enter a password and then check to see if that matches the password in the system.
The fact that they keep blaming overseas customer support is pure blame shifting - you still hired someone and gave them access to all this data, Coinbase!
The question was about customer support. AML and KYC regulations do not require that customer support persons know your PII. That can be kept firewalled from them.
Isn't the whole point of crypto to keep PII out of it completely? If not, what is all this non-sense for exactly, other than the typical goals of pyramid schemes?
The main point of crypto IMO is to have a large-denomination bearer asset.
This is overlooked most places but if you examine around the time the FATF finally pretty much eliminated bearer bonds, bearer stocks, and large bank notes was exactly the time crypto really took off.
yes. IIRC ~2015 was when the last of bearer bonds/shares were pretty much all completely immobilized. I can't recall when the last ~1000 USD equivalent banknotes were printed but it was also close to that time.
It's simple. They want to centralize crypto and dickheads like armstrong are happy to be in line to make that happen. Just look at tether, what's the point of it? It's nothing but a front for inflating the price of bitcoin. It has NEVER been audited and has been found to NOT have any USD backing at all
Yes, but I do think an organization like Coinbase or a cell phone carrier - which are extreme targets of fraud - have an obligation to recognize that their employees are targets and implement greater security measures than most organizations. Maybe Coinbase should even pay higher wages and use onshore customer service agents.
You can take the Google approach of basically not empowering the agents at all. It's not worth trying to social engineer Google CS, because they can't do anything anyway.
You are writing this as if you know what countries Coinbase's call centers are located in and the role of organized crime in their economies, but you don't actually know either of those things.
Lol, that's because while Coinbase emphasizes its commitment to security and compliance specific details about the geographic distribution of its offshore personnel are not disclosed in its public filings.
My perspective was more "That's because you post contentious statements in public fora with no reason to believe that they are true, hoping to get a big reaction by offending people."
> ...bribed AT&T employees at a call center in Bothell, Washington, to "use their network credentials and exceed their authorized access to AT&T's computers to submit large numbers of fraudulent and unauthorized unlock requests on behalf of the conspiracy and to install malware and unauthorized hardware on AT&T's systems," according to the indictment.
> ..install malware and unauthorized hardware on AT&T's systems
That's not as harmless as unlocking phones early. A major carrier that has access to texts, geolocations, and call logs being hacked like that is extremely concerning.
How are you going to vet people to find out if they're vulnerable to bribery? Offer them a bribe during their probationary period, during which they only have access to fake customer data?
You can do a background check, but the reality of the matter is that you pay citizens a living wage to do the work instead of offshore it into a country that pays pennies.
Bank tellers can take thousands out of the vault at any time and yet it seems it’s not a very big issue.
Bank tellers do steal money from the banks they work for though and banks invest a significant amount of resources and have a lot of policies to prevent it.
For example at many banks the teller might need to get manager approval for some cash withdrawals, even for seemingly smaller amounts of money. Despite what it may seem, it's not because of some distrust towards the client but a safeguard against internal fraud.
Bank tellers are constantly surveilled by cameras, security guards, and several-times-daily cash counting, and it's still easy to find accounts of them having stolen significant amounts of money before getting caught. These are all from within the last year:
Being US citizens doesn't make people incorruptible. In fact, many other countries are less corrupt than the US. Someone in this very thread reports having witnessed bank tellers getting bribed in one of those countries: https://news.ycombinator.com/item?id=43996765
I've been through a background check designed to screen out people who were vulnerable to bribery. They interviewed my friends and family from the previous several years to find out if I was secretly gay, cheated on my wife, gambled, drank too much, used illegal drugs, or had money problems for some other reason. It took about a year. I think it would be hard for a financial institution to be economically competitive doing that kind of thing with their call-center workers, because their customers can't tell if they're secure or not, just how much their services cost.
Then shift liability and let the insurers take care of it.
With a lot of this online stuff, no matter who gets your password or access to your account it’s you who has to take care of it. Whereas if the bank teller steals from the till it’s not your problem.
> you pay citizens a living wage to do the work instead of offshore
But what about the capital class? How will they afford more yachts? So sad. They're.. um... job creators or something. Anyway, that's what Fox News told me.
Let me add to your statement. It is hard to keep call center workers bribe-proof WHEN they are paid peanuts AND they are working for a company that is in an extremely high risk business of managing crypto.
correct, but what's the alternative? they're paid peanuts because it's not exactly the kind of job you ever pay out the wazoo for. the only thing that comes to mind if I'm Brian Armstrong is going all in on AI bots that can get to 90% of the way there (maybe 95%) and then have domestic based humans that are paid more with (presumably) a less probability of being bribed. but realistically, the only way to stop something like this is going 100% AI bots but then that comes at the expense of customer satisfaction, and also bots that are exploitable through prompt manipulation.
alternatively limit the roles and what the offshore people are able to do, but then any escalation means domestic people, which brings us back to "well at that point just use AI to automate easy tasks"
Normally payment should follow the amount of power/responsibility. If you pay someone peanuts but they have root access to prod, then you should pay more or restrict their credentials. Same applies to being able to access PII.
Small set of privileged employees who work from the home office and are compensated to match. If an issue requires their attention, it takes time to resolve. But it's resolved securely. In essence, what Google does.
Alternative is the banking model. Low-cost customer service massively empowered and just eat the costs of breaches as they come.
> Coinbase didn't adequately secure sensitive customer information, and it was leaked
Practically every company has someone with credentials who is in some combination of debt, a damningly-adulterous relationship, a damningly-illegal substance relationship and/or feels underappreciated or slighted compensationwise. The question is generally how much it costs.
Which is exactly why insider threats should be explored as a threat-model and mitigated to make the blast radius as small as possible via rate PII sanitization, access controls, access monitoring, rate limiting, etc.
Bribes are one thing, but threats could also happen. This is a big part of the reason why I absolutely hate entities that think residential addresses should be public record.
This is a precedent to Coinbase employees getting physical threats at their door just because e.g. some voter registration, utility company, bank, credit card, or court record decided to release their name and addresses on the internet. People could show up at some Coinbase software engineers' apartment doors with guns demanding they send BTC to arbitrary addresses.
AFAICT it's impractical to keep residential addresses 100% private/secure - too many ways to get an address from any number of companies, organizations and governments that collect it for various reasons.
Plus numerous ways to infer your address from other data sources, including apps that grab GPS on friends' cellphones when they visit, etc.
Finally, shutting down paid data brokers seems virtually impossible in practice, which means anybody googling you can pay $20 and get everything.
Remember, the issue isn't lazy goodguys but even slightly motivated badguys, who then use third party scripts to do the data collection.
> shutting down paid data brokers seems virtually impossible in practice
Just jail them. Make it a felony to release someone's PII without their written consent, and make data brokers illegal to begin with.
> numerous ways to infer your address from other data sources, including apps that grab GPS on friends' cellphones when they visit
These are not the main vector of transmission of personal information. Yes, Meta could probably do some graph analysis and infer this, but it's a lot of work, and their data leaks are rare in comparison to all the other companies, financial institutions, and governmental organizations, that freely post residential addresses on the internet and to data brokers for the world to Google.
> companies, organizations and governments that collect it for various reasons
KYC requiring addresses should be banned. Companies should not collect a residential address.
It's not surprising. Coinbase is nothing but a money laundering exchange, just like every other sketchy crypto exchange out there. They were also engaged in pump and dump of various altcoins
It will happen (at least attempted) with on-shore support staff too, My next door neighbour used to work for a UK high street bank and even there support staff were approached, with some of them first befriended, and eventually bribed in to passing along PII. No doubt it happens in the US too. Just costs the bad guys more.
> The company said the hacker stole customer names, postal and email addresses, phone numbers, and the last four-digits of users’ Social Security numbers. The hacker also took masked bank account numbers and some banking identifiers, as well as customers’ government-issued identity documents, such as driver’s licenses and passports. The stolen data also includes account balance data and transaction histories.
I mean... wasn't coinbase sort of scammy to begin with? Several years ago I gave them some USD, turned it into BTC, saw the value of the BTC go up, but when I tried to cash out was told that wasn't a thing that was supported by their platform. Later I was told I could apply for a $399/year credit card and could partially pay off the balance with BTC sale proceeds. I'm sure this was all disclosed somewhere in the terms of service I clicked through, and I only lost $1000 to their scheme.
But I've always wondered why people think this is how investment vehicles work. I monkeyed around with stock market bets and even Robin Hood allows you to cash out of your positions.
I dunno why you had problems, but I've been using Coinbase with no problems at all for years. It's linked to my bank account, so if I want to pay for something with bitcoin, I can easily buy and send bitcoin with just a few clicks. I don't invest or speculate in bitcoin, so I only maintain a small account balance. And selling bitcoin and transferring the proceeds to my bank account has been just as easy and trouble-free.
It's more likely you didn't "lose" $1k, but that you had "missed profits". And if you missed the profits because you didn't verify yourself earlier for withdrawal, then that's on you.
Coinbase supported direct bank withdrawals well before they launched their crypto debit cards.
It's really unfortunate that KYC regulations required Coinbase to have this information in the first place. We should be establishing strong social norms against sharing PII without a legitimate reason; this is not just an individual theft risk but a national security risk. Coinbase doesn't pay into your Social Security account, so they shouldn't have your Social Security number. They don't visit your house, so they shouldn't have your address. Etc.
Historically, although KYC regulations were widespread in Communist countries, they were unthinkable in most democratic countries until 9/11, which provided spy agencies with their golden chance to write their wishlist into law. But unfortunately that helps foreign spy agencies just as much as, maybe more than, it helps domestic ones.
You seem to believe that AML/KYC regulation exists to benefit customers or to prevent or recover from account compromises. It does not, and I have no idea why you would think it does. Something like a Yubikey or iris-scanning stations could help to prevent Coinbase account compromises, but AML/KYC regulations do not require or even encourage them, though perhaps someday they will.
Under specific conditions, the client can communicate with malware already on device, save data locally for other software to pick up, or downright stream the decrypted software to a third party.
Most likely is to introduce a flaw in the client that can be used by other walware on the client.
Roll out an update that defeats the end to end encryption in some subtle way that wouldn't go noticed for a few days. They'd be told when to do it for maximum effect, and if the window is small enough it might even go unnoticed for far longer when another uncompromised update overwrites it. They have no duty to report such things to relevant authorities even if it was discovered internally, so you could be looking at some corporate coverup that while not in on it, seeks to minimize liability/embarrassment.
Really, can you possibly tell if your Signal messages were compromised? Now that iPhones aren't really jailbreakable, you can't even see inside your own device.
If they were Coinbase employees or contractors, that means the company basically sold its own data to hackers, who then turned around and demanded a ransom.
Reimbursing duped customers makes sense, as it seems like they would have a pretty straightforward case to make in court that Coinbase's actions led to their loss.
I'm more curious if someone who feels the need to move, change banks, change their email, hire a security detail etc. could successfully sue the company to recover some or all of those costs.
I guess they didn't have as much luck as they wanted scamming Coinbase's customers, and once they had their fun they decided to try extorting Coinbase themselves.
[1] https://www.youtube.com/watch?v=HNziOoXDBeg
Coinbase not only leaked your full name and address, they also gave up your balances, your transaction history, and images of your government identification.
People with "significant" crypto balances are being assaulted on the street and in their own homes, and family members are being kidnapped for ransom.
"Significant" in this case can be $10k or less.
Until now, your best defense secrecy. Never talk about crypto in public in any way that could be traced to your real-world identity.
Thanks to Coinbase that defense is now gone.
The bad guys can see who has ever had a significant balance on Coinbase (even if they don't right now), whether that balance was sold for cash and how much, or if you've ever transferred tokens off the exchange to a self-custody wallet.
Now the bad guys know who's worth kidnapping for ransom and where you live. For most people, a Google search of your name and home address turns up the names of family members who would would also be lucrative targets for kidnapping and threats of violence.
Coinbase will never be forced to reimburse all the damage they've done because the true cost would bankrupt the company.
https://www.yahoo.com/news/florida-teens-kidnap-las-vegas-20...
This story keeps repeating. Maybe we should try it and see if it works as a deterrent.
I wonder why, select a person completely at random and by median you'll get just as much from what they have sitting in their checking account. Select a nicer area for an order of magnitude more. That's not encouragement to go assault people in their homes or kidnap families... just confusion.
Crypto? It's wild, and people think it's wild.
Google's call screening feature picks up the phone before it rings and asks the caller why they're calling. If they actually give a good reason, then it shows you the reason as text and you can decide whether to hang up on them or answer. https://support.google.com/phoneapp/answer/9118387
The calls they flag as potential spam and telemarketers has been 100% accurate in my experience so i wish I could just silence those
Same with my Microsoft account actually
I usually just ignore it but I assume someone is testing if my email can be used to login.
I was looking through some phishing e-mails the other day out of curiosity and found a weird unicode character mistranslated. Immediately knew it was an artifact of bad translation. So they're not perfect, but they're damn good.
.. and are former employees of Coinbase .. oh! just imagining!!
I see "We wanted to let you know that we detected activity suggesting that information related to your account may have been accessed in a way that did not align with our internal policies." in the email i got this morning
It would be so simple to have access tracking and flag or lock out rogue employees... I look forward to seeing what the golden parachutes look like.
It won't work for 100% of all calls (what if the customer is locked out themselves etc.), but those calls can then be handled by even more closely monitored agents.
"Less than 1% of monthly transacting customers" means up to 1% were accessed – that seems very high, i.e. much higher than the number of customer service contacts I'd expect.
And what that means is that
1) If you lose access to your account (through either your own fault, or coinbases fault) that the process of recovering it may not be so straightforward anymore.
2) Hackers can try to “recover” accounts now using this leaked info.
This is a huge problem. What coinbase needs are IRL offices where you can go and do things like account recovery, and where people trying to steal money can be caught and prosecuted (and makes a huge barrier for the overseas thieves who are usually doing this)
The only solution here is: hardware 2 factor like yubikeys.
What you've described is the same thing that many Crypto enthusiasts call a "Bank"
One that I'm using does, but I find it extremely annoying when they have me go to a branch to unblock my account that they locked due to a poorly calibrated risk system (that they need due to not supporting actually secure 2FA methods).
I guess I can walk downtown to CB HQ, but something tells me I won't get past the front desk.
People getting locked out of their account (which can happen due to no fault of the user, e.g. by an overly nervous risk system) will be really happy to have to potentially travel to a different city to regain account access...
And when that’s lost, what do you do? Aren’t you back to account recovery step?
Is this satire?
That's just a bank.
I don't think anyone claimed that crypto was un-losable or un-stealable. It's not magic.
https://cryptosteel.com
It may not be a crypto-as-a-theoretically/ideologically-pure-construct problem, but it absolutely is a crypto-as-a-real-world-asset problem.
So if we want to constrain impact of such attacks, we must make companies keep less data and delete them faster. For example, instead of storing a photo of ID, store just a checkbox that the person showed their ID and it was valid.
This applies not only to cryptocurrency, but to any company like Google, Uber, Amazon etc - if they didn't keep extra data, there would be little value in the leaks.
So the blame is not at cryptocurrency, but on companies not wishing to delete the data and governments demanding them to collect the data not necessary for operation. It's the government and capitalists who create problems out of nowhere.
Gets you the equivalent of mugged by people on the other side of the planet?
At least with cash, it's a one-on-one involuntary transaction.
Cryptocurrencies are classified, for now, as securities.
Currency is currency and cryptocurrency is not. So please do not attempt to compare apples to oranges here.
https://en.wikipedia.org/wiki/Security_(finance)
If you wish to compare cryptosecurities to other securities, then do that, but don't try to act like it is some sort of future utopian currency.
Come on, if you’re going to copy someone else’s snark, pick a good one.
https://www.coinbase.com/blog/protecting-our-customers-stand...
> We will reimburse customers who were tricked into sending funds to the attacker due to social engineering attacks. If your data was accessed, you have already received an email from [email protected]; all notifications went out at 7:20 a.m. ET on 5/15 to affected customers.
It's fine to send a notification instructing them to visit the secure portal for more info, though. Hence, no-reply.
To contact the company you should go to company website at the address you know (which shouldn't be given in email as well), log in and send a message through internal message system, possibly referring to the email that you recieved through a random code (those can be auto-suggested if they recently tried to contact you by email).
If you do anything else your communication knwowingly mimics communication of a scammer.
Unrequested email should always only be one way communication. Email is too untrustworthy for it to be anything more.
It’s fascinating that we keep creating new technology and then find out that in practice most of it cannot be trusted. Which means it cannot be used for anything serious.
IT revolution is a bit of a failure
I'm curious why no Coinbase Prime accounts were part of the leak (assuming that's what they mean). Is there some sort of additional layer of data protection behind the Coinbase Prime paywall? Or perhaps those accounts were intentionally avoided as they would presumably belong to more savvy users.
Why not just say what country the are from and how they hired them to start with. It's presented as those sneaky "overseas" people that somehow got access to our systems. This company makes what, a few billions in revenue but they couldn't vet and hire the right people?
They could have designed KYC to minimize long-term storage requirements etc at some cost to what they could enforce, but a government like the US is inherently sloppy with the rights that are reserved for parties besides itself.
For a site such as this the odds aren't in their favor anymore.
I’m not usually a huge fan of crypto folks, but I applaud this.
I hope they are serious about paying the reward, and aren’t planning to rug-pull it.
They could always pay it in crypto.
It would also make many Ponzi schemes easier to spot, as they wouldn’t want to contribute.
> and will not pay the $20 million ransom demand we received. Instead we are establishing a $20 million reward fund for information leading to the arrest and conviction of the criminals responsible
That, and they're reimbursing customers who were tricked.
That’s very load-bearing. It won’t help.
The CS reps are based in a LCOL country so the opportunity for theft is simply incredibly lucrative.
What is really needed, is customer-in-the-loop for access to their data. The problem is, not all accesses would make sense. Doing analytics over the data of the top 1% of customers, for example, requires some level of access, but would freak out those customers if they had to approve it.
What about, for example, a higher-tier support person performing QA over someone else’s work? What about DFIR teams doing research on potential abuse? Etc etc.
Yet he's a bit urban edgy here, and the staging is like it's an impromptu social media reaction to some online slight. (though reading a script)
You don't want to go full South Park "We're sorry", but I'd feel better about a response in a business dress shirt, out of respect for wronged customers.
With a bit more humbled posture.
IMHO, you're answering to customers you've wronged, and you don't wear a hoodie to church nor court (nor do you play video games during a live TV interview), nor do you assert superiority over the people you let down.
You can convey respect and humility, while also conveying being capable of responsibly resolving the problem.
(Just one person's reaction. I see some things the video did right, IMHO, but some other things jump out as wondering why they did that.)
Using a hardware/"cold-ish" wallet does not protect you from scam calls: https://www.bleepingcomputer.com/news/security/physical-addr...
It's been a bad day.
Correspondingly I'd assume either a) paying the ransom doesn't take it off the market or b) the info they stole isn't that interesting.
How many people are going to anonymously attack themselves now, just to get a reimbursement!
>On April 12, Coinbase updated their user agreement to take effect TODAY, May 15, with new language about waiving some rights to class action lawsuits and jurisdiction selection.
https://bsky.app/profile/jsweetli.bsky.social/post/3lp7sw647...
Also, "Coinbase had detected the breach independently in previous months", aren't they required to disclose this? In the EU they are: Every EU institution must do this within 72 hours of becoming aware of the breach, where feasible
https://www.coinbase.com/en-de/blog/protecting-our-customers...
Wow. Why does customer support staff have access to images of the user's passports?The world needs to stop pretending that SSNs are secret. They aren't.
[1] https://news.ycombinator.com/item?id=41248104
I don't think that this is still legal under the GDPR.
The bottom line is Coinbase didn't adequately secure sensitive customer information, and it was leaked.
Not, "Gosh, 'overseas' people, what can ya do?"
They would have been better off not even bringing up their location if they weren't going to be transparent.
Without the right details the customer support people don’t get entry into the customers account details.
Banks have been doing this for 30+ years..
“Give a man a gun and he can rob a bank, but give a man a bank, and he can rob the world.”
The fact that they keep blaming overseas customer support is pure blame shifting - you still hired someone and gave them access to all this data, Coinbase!
Plenty of exchanges don't know their customers, and in fact that is how they get their customers.
This is overlooked most places but if you examine around the time the FATF finally pretty much eliminated bearer bonds, bearer stocks, and large bank notes was exactly the time crypto really took off.
You can receive crypto privately to your own wallet without sharing PII, without any exchange.
> ...bribed AT&T employees at a call center in Bothell, Washington, to "use their network credentials and exceed their authorized access to AT&T's computers to submit large numbers of fraudulent and unauthorized unlock requests on behalf of the conspiracy and to install malware and unauthorized hardware on AT&T's systems," according to the indictment.
https://abcnews.go.com/Politics/att-employees-bribed-1m-unlo...
> ..install malware and unauthorized hardware on AT&T's systems
That's not as harmless as unlocking phones early. A major carrier that has access to texts, geolocations, and call logs being hacked like that is extremely concerning.
Bank tellers can take thousands out of the vault at any time and yet it seems it’s not a very big issue.
For example at many banks the teller might need to get manager approval for some cash withdrawals, even for seemingly smaller amounts of money. Despite what it may seem, it's not because of some distrust towards the client but a safeguard against internal fraud.
Vannia Chatt: https://6abc.com/post/former-citizens-bank-teller-accused-st...
Karen Farrell Tigler: https://www.irs.gov/compliance/criminal-investigation/former...
Stephanie Rose Kilbert: https://people.com/bank-teller-stole-money-while-pretending-...
Derek Aut: https://www.justice.gov/usao-ma/pr/former-bank-teller-arrest... https://www.usatoday.com/story/news/nation/2025/03/28/boston...
Mountee Brown: https://www.justice.gov/usao-md/pr/maryland-bank-teller-plea...
Being US citizens doesn't make people incorruptible. In fact, many other countries are less corrupt than the US. Someone in this very thread reports having witnessed bank tellers getting bribed in one of those countries: https://news.ycombinator.com/item?id=43996765
I've been through a background check designed to screen out people who were vulnerable to bribery. They interviewed my friends and family from the previous several years to find out if I was secretly gay, cheated on my wife, gambled, drank too much, used illegal drugs, or had money problems for some other reason. It took about a year. I think it would be hard for a financial institution to be economically competitive doing that kind of thing with their call-center workers, because their customers can't tell if they're secure or not, just how much their services cost.
With a lot of this online stuff, no matter who gets your password or access to your account it’s you who has to take care of it. Whereas if the bank teller steals from the till it’s not your problem.
But what about the capital class? How will they afford more yachts? So sad. They're.. um... job creators or something. Anyway, that's what Fox News told me.
alternatively limit the roles and what the offshore people are able to do, but then any escalation means domestic people, which brings us back to "well at that point just use AI to automate easy tasks"
Small set of privileged employees who work from the home office and are compensated to match. If an issue requires their attention, it takes time to resolve. But it's resolved securely. In essence, what Google does.
Alternative is the banking model. Low-cost customer service massively empowered and just eat the costs of breaches as they come.
https://www.americanbanker.com/news/call-centers-and-bank-br... "Call centers and bank branches are major fraud liabilities"
https://www.bai.org/banking-strategies/beating-crooks-at-cal... "Aite Group’s findings that 61 percent of fraud can be traced back to the [call] center are equally concerning, as is its prediction that contact center fraud loss will double by 2020."
Practically every company has someone with credentials who is in some combination of debt, a damningly-adulterous relationship, a damningly-illegal substance relationship and/or feels underappreciated or slighted compensationwise. The question is generally how much it costs.
This is a precedent to Coinbase employees getting physical threats at their door just because e.g. some voter registration, utility company, bank, credit card, or court record decided to release their name and addresses on the internet. People could show up at some Coinbase software engineers' apartment doors with guns demanding they send BTC to arbitrary addresses.
Plus numerous ways to infer your address from other data sources, including apps that grab GPS on friends' cellphones when they visit, etc.
Finally, shutting down paid data brokers seems virtually impossible in practice, which means anybody googling you can pay $20 and get everything.
Remember, the issue isn't lazy goodguys but even slightly motivated badguys, who then use third party scripts to do the data collection.
I bought a house here after a long time out of country and the first year all I got for mail was scam bullshit. Loads of it.
Just jail them. Make it a felony to release someone's PII without their written consent, and make data brokers illegal to begin with.
> numerous ways to infer your address from other data sources, including apps that grab GPS on friends' cellphones when they visit
These are not the main vector of transmission of personal information. Yes, Meta could probably do some graph analysis and infer this, but it's a lot of work, and their data leaks are rare in comparison to all the other companies, financial institutions, and governmental organizations, that freely post residential addresses on the internet and to data brokers for the world to Google.
> companies, organizations and governments that collect it for various reasons
KYC requiring addresses should be banned. Companies should not collect a residential address.
If you sling code for cryptocurrency you and your loved ones are "in the game" now.
https://www.bbc.com/news/articles/c20qee5030do
It's hard to not believe in Karma sometimes.
From https://techcrunch.com/2025/05/15/coinbase-says-customers-pe...
> The company said the hacker stole customer names, postal and email addresses, phone numbers, and the last four-digits of users’ Social Security numbers. The hacker also took masked bank account numbers and some banking identifiers, as well as customers’ government-issued identity documents, such as driver’s licenses and passports. The stolen data also includes account balance data and transaction histories.
Nobody has sole control of their cryptocurrency by definition. It's a consensus protocol. (On a practical level, there are always layers of trust.)
But I've always wondered why people think this is how investment vehicles work. I monkeyed around with stock market bets and even Robin Hood allows you to cash out of your positions.
Are you sure you didn't fall for a scam version?
Coinbase supported direct bank withdrawals well before they launched their crypto debit cards.
Historically, although KYC regulations were widespread in Communist countries, they were unthinkable in most democratic countries until 9/11, which provided spy agencies with their golden chance to write their wishlist into law. But unfortunately that helps foreign spy agencies just as much as, maybe more than, it helps domestic ones.
In https://en.wikipedia.org/wiki/Know_your_customer#Laws_by_cou... you can see when they were introduced in different countries.
Yeah I know eventually these will be linked by some data broker and will meld into the same thing.
But I compare it to using a fingerprint to unlock a password manager on your phone. That ain't KYC.
Got to make it so employees can’t do anything nefarious. This helps protect them.
But they can look the other way about flaws in their Electron client.
Under specific conditions, the client can communicate with malware already on device, save data locally for other software to pick up, or downright stream the decrypted software to a third party.
Most likely is to introduce a flaw in the client that can be used by other walware on the client.
Clearly no red team members on HN these days.
Really, can you possibly tell if your Signal messages were compromised? Now that iPhones aren't really jailbreakable, you can't even see inside your own device.