Bitcoin Forum

Hello,

We are the admin team for https://bitbet.us (https://bitbet.us), and it has come to our attention that Coinbase has silently started tracking how their customers spend the coins purchased on their site.

One of our users what threatened by Coinbase with account closure after he placed a bet on our site.

The implication is basically that Coinbase is now officially in the business of deciding what you can and can't do with your own money.

They've essentially lowered themselves to the level of the likes of VISA and Paypal.

Should you decide to spend your coins on dildos and should Coinbase tomorrow decide that dildos are something they disapprove of, you may face account closure.

Caveat Emptor.

This isn't something new, coinbase has been closing accounts over involvement with gambling providers for ages.

A report from December last year for example: Coinbase closed my account after 1 week! (https://bitcointalk.org/index.php?topic=1278463.0)
A collection of links regarding the matter posted last month: Coinbase - Gambling (https://bitcointalk.org/index.php?topic=1508261.msg15178470#msg15178470)

This is going as far back as to 2014, where NLN posted the following thread: Gamblers, be careful with Coinbase! (https://bitcointalk.org/index.php?topic=747596.0)

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Yep, indeed. This shouldn't be news to anyone, and it shouldn't be shocking either.

Of course. They are a regulated company following regulated rules. You shouldn't expect less.

I think if we wanna still be anonymous we can use crypto mixing services after we bought bitcoin on coinbase. And it can do even if just 0.001BTC we can mix it.

Coin base is is a Bank of the Bitcoin World.Since day 1 they have been very strict about tracking users especially transferring coins on the Gambling sites.The solution is : Don't keep a static wallet with a fancy name of your website in the public chain or use a coin mixing service.

Thanks for the links, we didn't realize Coinbase was in the business of telling customers what they can and can't do with their own money.

This is really amazing, they're basically eliminating 90% of what makes bitcoin useful ... why would anyone use their service ?

When someone draw cash at a US bank, does the teller explain that they are not allowed to gamble with it and that he will close the account if he suspects the money will be used to gamble ?

Also, it'd be interesting to conduct an experiment to see if they still do this if a user first transfers the coins to a wallet on their own computer prior to placing the bet.

We've never heard of a bank that tells people what they can and can't do with their money.

Try using your credit card at an illegal (/unregulated) physical casino.

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This has to do with basic US laws. Coinbase is a registered company and hence has to follow the laws they're under.
This means FinCEN (https://en.wikipedia.org/wiki/Financial_Crimes_Enforcement_Network) having an eye or two on them, and in conclusion also all coinbase users.
Online Gambling is a big red flag in the US (or at least most states, I'm not an expert on their laws, rather sharing what I've come to know over the time),
there's a reason why Primedice and some other sites block users from the States.

All you have to do is transfer your BTC from Coinbase to another wallet and send from there.

Jeez how simple is that?


~BCX~

That's assuming they won't track that as well.

Yes. That's actually true. I recently read some articles regarding this news. They are strictly tracking your transactions in and out. They usually ban some accounts who is playing in gambling sites if they see that the account is underage. So if I were you, I would rather move to the other wallets but for me, that's one of the best wallets ive ever seen online. Some other wallets don't have much security that's why other accounts can been hacked without prior notice.

Coinbase is a regulated Money Services Business under FinCEN which basically means it has to abide by the law. Gambling is not allowed in most parts of the US, they are probably required to have compliance mechanisms in place to ensure that users are operating within the law. This is something people will have to get used to if we want Bitcoin to ever go mainstream one day.

Only as long as they opt to use shitty online wallets, may they be called coinbase, xapo, blockchain.info and whatever else.
If you'd use a properly set up local wallet (electrum, core, armory,...there's enough for everyone to find a favorite), that's a whole different story.

This is nothing new.I know that Coinbase is tracking transactions.

Many people were banned from Coinbase for gambling transactions.

Just use another wallet service.

I think people need to read the terms and conditions of using their services. Otherwise people should just use other wallet services. Good one is to start a full node and you can do anything with your coins without asking any permission- and support the bitcoin network at the same time.

You've never heard of a bank that says you can't launder money or fund terrorism? Really?

this is not new, but it is strange that they have warned that user because i have heard that they close down your account if you use the funds for gambling and also this is clearly mentioned in their rules when you sign up and click "I accept" without reading it :D


since they are simply a service provider you don't have to use them. there are a lot of other good bitcoin wallets that people can use. coinbase is only good for purchasing easily and then withdraw to your desktop/cold wallet

Don't use Coinbase.

Three words. It is that simple people. Perhaps it would be helpful to repeat:

Don't use Coinbase.


Now, I have an account there. But only because someone pays me periodically, and they are only set up to pay into Coinbase accounts. So I have a Coinbase account. But I don't really use it. I just receive payments, and then move my newly acquired coins to another wallet. There are only three reasons for actually using Coinbase: A. You are lazy, B. You are stupid, or C. You are lazy and stupid.

They say repeating something three times commits it to long-term memory, so here it comes:

Don't use Coinbase.

But then again if you are already registered with Coinbase, send your btc to an exchange withdraw them after to another address , they still able ti trace you and tell you what to do with your coins ??  :o

Most of my dildo buying online is actually done with bitcoin so being banned by coinbase would be unfortunate.  But on a serious note,  that's why i don't use coinbase.  If they have to stick to such laws then they should move their business into a free country where such restrictions are not in place.

so regulation now is synonymous of privacy violation?, you can't have both, but there must be in between a way to follow to avoid issue with either one

like for example do not track all customers, but just those that you believe are not 100% honest citizens...

You really think that if Bitcoin goes mainstream you'll be able to avoid regulations by using a local wallet? If the government gets involved in Bitcoin, and they will if Bitcoin becomes a legal currency, you can be sure that every single coin movement will be tracked. The blockchain makes it impossible for anyone to do anything without being noticed.

Bitcoin will stay pseudo anonymous no matter what, unless you're afraid of a change in code, that none would adopt to anyways.
That being said, no matter how many eyes are watching, being pseudo anonymous is perfectly fine for me, with a few additions here and there.

+1000

Coinbase is not the only site that blocks users if they find out that their site was used in gambling. Even coins.ph has blocked some members who they found out use their site for gambling use. So the best way is to use blockchain wallet in gambling. Then you can forward it later from blockchain wallet to coinbase.

That’s not fair in my opinion. How one can decide that what another one should spend? I am curious about alternate service providers, anyone here faced similar situation? If we call it anonymous then what’s the point of it to get rules and regulations implied on it. It doesn't matter if they are tracking how users are spending their coins (as they are service providers so they have right to do that under the name of ‘improving user experience’) but it’s none of their business to force users to spend or forcing them to refrain from spending at particular site.

This is very bad example of services but it is not new for us, betting is totally against their terms and conditions, I think that is the reason so many people who are interesting in gambling with bitcoin finding the other way, coinbase is going very strict with its policies and now recently it closed its services in some countries.

Agree with you I had many friends  got deactivated by coins.ph
And many had fear to use that local wallet, but if your not use this wallet from gambling I don't see any problem they just strictly in gambling and malicious transaction. so if you want to gamble don't use this wallet use blockchain or other online wallet  that's part of terms in condition just read it first.

They're not tracking anything that doesn't leave a Coinbase wallet.

As mentioned above, try funding a terrorist organization or even funding an unregulated gambling site from your CC or bank account, see what happens.

Imagine that, authorities get a little touchy about funding illegal activities.

Privacy and the ability to commit crime anonymously are two separate things.



~BCX~

Haha i was sent the mail by Coinbase in the last year. They told me that they would ban my account if i sent money to those bet site. Lot of people have been sent the mail like me since last year.

Nothing new, nothing unusual from their side. People need to understand that using Coinbase as a wallet is not good idea at all and avoid doing that.
Same with Xapo Wallet which has similar level of control over people's account and they're monitoring your every transaction. So you:

1. Can't gamble or receive/send coins to any related with gambling services or using VPS to access their service.
2. Legally you have to over 18 years old to use their wallet.

Yes. If you think otherwise you are misguided. Have you heard of this new currency called Bitcoin?

It seems their track your coins 3 hops away, according to some accounts we've heard on Reddit.

There's only one destination for coins bought at Coinbase, and it's to be sold at Coinbase.

Use it as an exchange not as a wallet, if you need a wallet use a proper one.

Words of wisdom. And send them to your wallet via a mixer.

It can be tracked but it would be difficulty for them to tie the coins to a single person if a mixer+ bitcoin core is used to prevent sybil attack. It can still be tracked to a person if the end address is to a service which requires ID verification.

Meh, nothing new. If you don't like it, just switch to a different wallet. How does wallet-explorer find out which site owns which address anyways?

Yep, not a surprise.   Banks do this too.  I got asked by my bank what all the Circle transactions on my account were and if any other people were involved (!).  Coinbase closed my account last year,  and I never deposited any bitcoin on gambling sites.  No loss, really.

Bitcoin is not anonymous. And that allows such behavoirs.
Use your own wallet. Use anonymous coins or mixers. Use the services like Coinbase only as exchange.
Then you will have your privacy and no one will be able to interfere.

That's the reason I don't like coinbase. If I need to send coins for a trade, they won't let me do it and start investigating if the user asks me to send coins to a gambling address of his. They also give our information if they need to and without confirming or informing us.

They track anyone, not only those that try to gamble with the coins that are in coinbase's addresses.
Even the kickass torrent owner was tracked by coinbase and that's how he was arrested recently.
Because they have zero fee on transaction doesn't mean that is free!

Anyone who is lured by zero fee policy of Xapo or Coinbase or any other online wallet provider are simply shortsighted and greedy individual.
This is what you will bet for not paying that 1 cent fee - lack of anonymity, tracking of your every transaction, invigilation and KYC/AML procedures everywhere.

I was a bit surprised when I heard how exactly coinbase helped in arresting the kickass owner, the zero transaction fee is good for those that make transaction very often and when the total amount of transactions is not big which can help the sender saving a lot on fees.

If Coinbase decides to close your account, do they allow you to withdraw all that you have left with them or you just have to say bye bye to your remaining coins?

And this is why you all should use a service like www.blocktrail.com which will never track you and never close your account. Never.

Hate the though of this sort of thing happening.
It is just like farming personal data and who knows what they are going to do with it once they aquire enough of it on each and every individual that has signed up for their wallets there.
Is it even possible to cancel your account once you have one? >:(
I thought not. :-\

If anything (in Cyberland) is free, then YOU are the product.  Your information, etc.  GOOG and others are very happy to offer such free services as email, YouTube, etc.

Whenever I get BTC, from whatever source, I mix them before I spend them.  Or before sending them to a cold wallet.

I don't think they really helped anything, the kickass owner had screwed up a lot, and he had a lot of his bank accounts connected to the site by receiving advertisement payment directly to them.
I think the coinbase account for bitcoin was only used as for receiving donations only not every money transaction like payments.

and even if my speculation of this situation is wrong but I seriously doubt that the zero fee was the reason for using them because he already had made millions of dollars from the site and what is a pathetic btc transaction fee compared to that :D

what's the purpose coinbase tracking spend coin is client
i think coinbase anticipating about money laudnring
ilegal money, gamble, terorisme, narcotics, alcohol and more

coinbase is based in United States and you would be a fool to believe they haven't been tracking your bitcoins and how you use them. and this is true about all of the services based in that country. they all will track you and make detailed logs from your activities.

I think that they helped them because coinbase has the IP of every user and has stats where are these bitcoin coming from and where are their users spending them, so when apple facebook and coinbase merged the power the full details of the kickass owner came up and he got arrested in this way I think.

We don't know for sure how big Coinbase's contribution to Artem Vaulin arrest really was, we can only speculate at this point.
What is certain, however, is their their spying behaviour is a fact and they will give out any personal information of their users to anyone who asks them.

Of course. Coinbase have are a regulated company following regulated rules, and I sure it for security reasons, but we can tracking when we spend our Bitcoin

Good to know about it.

Yes they are always checking every transaction you do because those regulations do not allow you to gamble, I thought no problem will it as long as they keep your personal data safe.

To some extent, this is expected. US laws are quite onerous, and US regulatory and law enforcement agencies can be quite brutal to deal with. However, I do recall hearing about instances where they wrongfully closed peoples' accounts because their blockchain analysis was wrong. Something about confusing Bitstamp wallets with coins that eventually ended up in dark markets, or something.

Anyway, the fact that they are watching so closely is cause for concern. I would only use Coinbase to send fiat into, buy coins, and send them to cold storage. I would not use them for anything else, and I certainly would not send coins there.

there is a well established bank money system and all regulations is about to keep it as is.
e-currencies can live without that much connection with flat bank systems and/or regulations
but we must change our ways and stop thinking always just the euro/$ equity of our coins.
make if friend to friend , or use services or goods directly on Bitcoins or other alts will do.

have a nice day all.

What I'm curious about is the extent to which they link outputs to you. If you use Coinbase to directly send funds to a betting site -- OK, I see it. There is a direct connection there. But how about if you send coins from Coinbase to your desktop wallet, then send to the betting site? Will they still shut down your account? Can anyone comment on that? I wonder how they would be able to prove that it was you, their customer, sending money to the betting site.

God dammit..... How can I buy muh dildos now??

No. it has to be from Coinbase to a betting/casino site directly. If you use a middleman (your software wallet) then it's good.

Not correct. If they can see (and that's easy) your money comes from gambling, then it is and will be a problem. Even with one or few wallets in between.