Ethereum Dev Sees Coinbase Account ‘Nuked’ After Attempting USDC Transfer

“Coinbase just locked my account after trying to send $25,000 USDC,” Ethereum developer Eric Connor reported on December 3rd.

“Wasn’t Brian Armstrong just talking about unseating? Cool!” he joked.

He added that the notification was “completely useless” as both ways to unlock the account required him to log in, which he was unable to do.

“The service agent on the phone is also completely useless,” he added.

Coinbase just locked my account after trying to send $25,000 USDC

It wasn’t @brian_armstrong just talk about unbanking???

Very cool! pic.twitter.com/3s7waNxsWn

— eric.eth (@econoar) December 2, 2024

Consider Nuked a lazy solution

Others pointed out that he was not being “de-banked” but was being protected against account hackers and unauthorized transfers to safeguard the $25,000 USDC. It seems like a “lazy implementation if that’s the case,” he said, before adding:

“There are a lot better ways to handle this than just using my account.”

Connor then revealed that the account was locked because he was using a VPN (virtual private network) when transferring and there was no warning that this could happen.

There were many responses of agreement from those who had also been locked out of centralized exchange accounts without warning, some of them for months. Blockchain attorney Joshua Carlson said the system generally works as designed.

“I would recommend setting up a password and I wouldn’t bother with Coinbase if they suspected someone was trying to hack my account and they locked it. I’d consider that a net benefit,” he added.

Coinbase responded to the post, saying, “We’re sorry to hear that your account was locked after sending your USDC assets. We’re currently investigating this and will get back to you shortly. In the meantime, please send- DM us so we can provide you with updates directly.”

A few hours after the block, Connor reported that the incident had been resolved, but added that the responses to his post on X were “mind-blowing”.

“Hopefully Coinbase is working on a much better process for locking accounts and getting them back not so easily. I’m lucky with my reach. Others, not so much…”

Limits decreased without notice

Other responses were from customers complaining that their daily limits had recently decreased for no reason.

Ethereum developer ‘Zak’ opined that this may be an effort to reduce selling pressure.

“My theory is that they are limiting the limits for people who have withdrawn more than a certain amount in the last year or something to reduce selling pressure and keep liquidity on their books.”

Centralized exchanges are slowly morphing into banks that exhibit similar behavior, including arbitrary account closures, lack of customer support, transaction limits, and demands for increasing amounts of personal information.

SPECIAL OFFER (Sponsored) Binance Free $600 (Exclusive to CryptoPotato): Use this link to register a new account and receive an exclusive welcome offer of $600 to Binance (full details).

LIMITED OFFER for CryptoPotato readers on Bybit – Use this link to register and open a FREE $500 position with any currency!