Customer service representatives in overseas locations accepted bribes from hackers who stole customer information containing names as well as partial Social Security numbers and transaction records then asked for a $20 million ransom from Coinbase. CEO Brian Armstrong stated that the obtained data facilitated social engineering attacks although the thieves failed to access any financial resources. The company refused the ransom payment by offering a $20 million reward for the arrest of the attackers and simultaneously terminated their personnel. The stock price fell 6% despite achieving a 22% monthly increase. The remediation and reimbursement expenses for the breach will cost between $180m–$400m according to the SEC filing. The company established fraud monitoring measures together with domestic support operations to stop similar incidents from happening again. The breach revealed crypto’s cyber security threats after Chainanalysis documented $2.2 billion in cryptocurrency thefts throughout 2024. The upcoming inclusion of Coinbase into the S&P 500 demonstrates how cryptocurrency entered mainstream markets but it also reveals its security weaknesses. Armstrong expressed his commitment to pursue justice and simultaneously alerted users about active scam threats. The attack reveals human weaknesses in cybersecurity systems because social engineering attacks have become the primary hacking method that Coinbase must overcome to maintain trust while the industry experiences rapid growth.
Coinbase Rebuffs $20m Ransom Demand
