Crypto sleuth ZachXBT urges Coinbase to take action after its users reportedly got scammed for tens of millions from Dec. 2024 to Jan. 2025 alone.
In a viral thread that has reached millions of views, ZachXBT and zeroShadow web3 security investigator tanuki42 compiled reports from Coinbase users who lost their funds in a series of social engineering scams throughout December 2024 up until January 2025.
After gathering Coinbase withdrawals reports from X users via direct messages, the duo concluded that at least $65 million have been stolen from Coinbase user accounts during a two-month period. Though, Zach claims this estimation is likely much lower than the actual number, as it does not include Coinbase support tickets and police reports.
Zach predicts that if these scams persist, Coinbase users could stand to lose more than $300 million per year due to falling for social engineering scams.
Crypto.news has reached out to Coinbase for comment, but has yet to receive a response.
In the past few months, dozens of Coinbase users have complained online about their accounts getting suddenly restricted. Something the exchange has dubbed “FUD/misinformation,” claiming that the surge of new users and old users reactivating their accounts after the U.S. election has led to an increase of fraudulent attempts by up to three fold.
“Our fraud-prevention systems are acting as expected and have saved customers tens of millions in losses in November alone,” wrote Coinbase Support.
However, Zach said these restrictions were the direct result of “aggressive risk models and Coinbase’s failure to stop its users losing $300M+ per year to social engineering scams.”
Scammers posing as Coinbase support
Social engineering scammers steal funds from Coinbase users by calling them on a spoofed number and telling them their account has been compromised. The scammer would then send a fake email from Coinbase with a fake case ID, instructing the victim to transfer funds into a Coinbase wallet while “support” verified their account security.
The link on the fake email would lead them to a cloned Coinbase site, which allows scammers to send different prompts to the target via spoofed emails using panels.
ZachXBT said Coinbase has failed to properly “diagnose the actual problem” but has also acknowledged some of the things the crypto exchange has done well, such as providing recovery tools for users who deposit unsupported assets and providing a good stablecoin yielding and on-ramp/off-ramp mechanisms.
He urged Coinbase to consider making phone numbers optional for advanced users with authenticator apps, creating an app specifically for beginners or elderly users that does not allow withdrawals, improving community outreach, as well as taking legal action against the U.S. based scammers and TransUnion for negligence on behalf of users as it’s the primary tool used by cybercriminals.
“Coinbase needs to urgently make changes as more and more users are being scammed for tens of millions every month,” said ZachXBT.
