- On August 30 (Friday), Coinbase erroneously sent an email to its users stating that their two-factor authentication (2FA) settings have been changed.
- The email triggered panic and confusion among users, as they thought their account might have been hacked. The incident also led to widespread public backlash.
- Coinbase took to social media and apologized for the incident. The company promised to credit users’ accounts with Bitcoin (BTC) worth $100. Also, the firm said to CNBC during an interview that the incident happened due to an internal error.
Coinbase Goofed up Sending 2FA Notifications to Users by Mistake
Coinbase, a leading US-based crypto exchange, sent an email to users by mistake saying that their two-factor authentication (2FA) settings were changed.
The company mistakenly sent an email to its 125,000 customers, triggering panic among users and resulted in a massive public backlash.
After committing this blunder on August 30 (Friday), Coinbase apologized to users for the mistake on Twitter, saying that the company always focuses on developing reliability and security in the crypto industry to make the concept of open financial system a reality.
Coinbase also added that they will keep working to gain back users’ trust, who got affected by those emails. However, this incident may have already hurt users’ trust.
Users Panicked Thinking that their Accounts Might have been Hacked
After the fiasco, users spent their weekend in panic and scampering to check their Coinbase account to see if their investments were safe.
Despite the apology of Coinbase, many users took significant measures after receiving the email, fearing that hackers might have taken control of their accounts. Many users tried overhauling security settings and liquidated their crypto tokens.
The social media platforms were full of user comments, stating that they could not access the Coinbase app for several days since the incident.
As a measure of its damage control, the firm also announced that it would reimburse users with Bitcoin (BTC) worth $100.
After this announcement, several Reddit users commented that they did not receive the promised $100 credit. Many users also pledged to move their investment to another exchange after the incident.
Unfortunately for Coinbase, this incident happened days after the news when thousands of unhappy customers claimed that their Coinbase accounts had been hacked and drained.
Coinbase Began the Damage Control by Giving an Interview to CNBC
Earlier, CNBC came out with a story on August 24 stating that thousands of users said they did not receive any support from Coinbase regarding the alleged incident.
CNBC reported that thousands of complaints by Coinbase customers around the country revealed a pattern where users found their money suddenly disappeared from their accounts. Subsequently, poor customer support from Coinbase made things worse, as they were left hanging and disgruntled.
Subsequently, the email error made Coinbase clarify the matter to CNBC saying, that the incident happened due to an internal error.
The first email that the company sent to customers mentioned that their two-step verification settings were changed. After the panic and confusion among users, Coinbase sent a second email saying that it was sent by mistake.
One of the users said he thought he had to sell his crypto tokens before he loses the money. Subsequently, he sold crypto worth $60,298, which he was investing in for his grandson. Now, he is doubtful whether investing in crypto is a safe option or not. The same feeling was palpable among the rest of the users.
Earlier, Coinbase went public in April 2021. The company has now over 68 million users and holds assets worth $223 million. This incident could be a wake-up call for the firm.