Coinbase Exchange Explain How They Saved Their Users From Twitter Hackers

[gmjutt6]

Surprised when I read this news and was thinking that all exchanges should take steps in future like coinbase. Coinbase prevented 30 bitcoins($195000) of their 1000 users.

Source. https://cryptodaily.co.uk/2020/07/coinbase-hackers-users-twitter

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[fillippone]

Surprised when I read this news and was thinking that all exchanges should take steps in future like coinbase. Coinbase prevented 30 bitcoins($195000) of their 1000 users.

Source. https://cryptodaily.co.uk/2020/07/coinbase-hackers-users-twitter

Not your keys, not your bitcoins.
I don't care what they did or how. It was unethical. Censor transaction of a client could even mean a violation of the ToS.
Simply, better fall in a scam hodling your money in your wallet, than being babyguarded and having your transaction censored.
If you allow to censor your transaction once, you are allowing to do that everytime.

Coinbase the most anti-Bitcoin organisation. Make #DeleteCoinbase great again

[avikz]

While coinbase has done great in this particular incident, but you have to look at the flipside as well. A central business authority prevented users to use their own money for whatsoever reasons. For this incident, Coinbase deserves a thumbs up, but in general, someone else controlling your money in a nutshell and they have the power to decide when and where you can spend your own money!

Not being pessimistic but that's the reality.

[kryptqnick]

I agree with what's mentioned above. It's an interesting pattern with this Twitter case, really. Twitter suffered a hack like it hasn't suffered before, but it was clearly carried out due to taking over some employees' accounts with, it seems, privileged access to data about the Twitter verified accounts. So while Twitter is behaving like a victim here, and also like a company that dealt with the issue very fast, it doesn't comment on why it was possible to gain access to those accounts through the accounts of their employees. Coinbase here is also trying to show that they're dealing great with the scam, but them being able to make this decision and deny a Bitcoin transaction of their users is itself disturbing.

[coin999]

Quick thinking & execution on Coinbase part !

[AniviaBtc]

While coinbase has done great in this particular incident, but you have to look at the flipside as well. A central business authority prevented users to use their own money for whatsoever reasons. For this incident, Coinbase deserves a thumbs up, but in general, someone else controlling your money in a nutshell and they have the power to decide when and where you can spend your own money!

Not being pessimistic but that's the reality.

Hoping that most of the exchange are responsible about its customers safety and monitoring of scam transactions.

Coinbase exchange will surely have a massive increase in its reputation as it prevented users to engage in a harmful scams where they will lose their money.

It is not only those victim's fault, but also Twitter's, their platform should be accountable about these scenarios where people don't feel any comfortableness in using their platform. I don't really believe that it is not their fault, scammers used a high profile personality that's why believing in that tweet is easy for those people who trust easily.

[alani123]

Surprised when I read this news and was thinking that all exchanges should take steps in future like coinbase. Coinbase prevented 30 bitcoins($195000) of their 1000 users.

Source. https://cryptodaily.co.uk/2020/07/coinbase-hackers-users-twitter

Not your keys, not your bitcoins.
I don't care what they did or how. It was unethical. Censor transaction of a client could even mean a violation of the ToS.
Simply, better fall in a scam hodling your money in your wallet, than being babyguarded and having your transaction censored.
If you allow to censor your transaction once, you are allowing to do that everytime.

Coinbase the most anti-Bitcoin organisation. Make #DeleteCoinbase great again

I agree with everything else you said here, but UNETHICAL? Theft, extortion and deception are considered to be breaking even the Non Aggression Principle. Which is... The very basis of libertarianism. By extention of that very notion, simply remaining idle while you see someone being scammed and knowing it could also be considered unethical.

Given that "not your keys, not your bitcoins" is true, then Coinbase would not only be liable of allowing the extortion to take place while they knew so, but it'd also be against their rational interest since it was as you say, their money. So I don't see why preventing someone from a sure monetary loss would be unethical by any standard.

Sure Coinbase has other unethical practice. Maybe their mere existence as a wallet is counter-intuitive for BTC, but preventing theft isn't unethical. Unless we bitcoiners want to build a new book of ethics ofc.

[fillippone]

<...>
Sure Coinbase has other unethical practice. Maybe their mere existence as a wallet is counter-intuitive for BTC, but preventing theft isn't unethical. Unless we bitcoiners want to build a new book of ethics ofc.

If I had an account at coinbase, my interaction with coinbase would be regulated with an agreement. The agreement, in loos terms, requires them to execute my orders.
If I give them the order to payt a scammer, why should they block this order? Maybe I am happy to be scammed, maybe I owe themy money because they lent me money before, or any other unknown reason.

It's the contract, not they willingness to protect me on my behalf that must regulate their actions.
Because once you allow them to censor a transaction for the right reason, they are going to do so for the wrong one.

[abel1337]

While coinbase has done great in this particular incident, but you have to look at the flipside as well. A central business authority prevented users to use their own money for whatsoever reasons. For this incident, Coinbase deserves a thumbs up, but in general, someone else controlling your money in a nutshell and they have the power to decide when and where you can spend your own money!

Not being pessimistic but that's the reality.

Hoping that most of the exchange are responsible about its customers safety and monitoring of scam transactions.

Coinbase exchange will surely have a massive increase in its reputation as it prevented users to engage in a harmful scams where they will lose their money.

It is not only those victim's fault, but also Twitter's, their platform should be accountable about these scenarios where people don't feel any comfortableness in using their platform. I don't really believe that it is not their fault, scammers used a high profile personality that's why believing in that tweet is easy for those people who trust easily.

Actually it's the customer's responsibility and fault if they sent bitcoin to the hacker's address but it is good that coinbase did a thing to save other who sent bitcoin to the address. The same scheme is happening all around social media platforms and coinbase having  the power to block the transaction did save other users. This somehow shows that custodial wallet are better on some cases.

[Upgrade00]

Because once you allow them to censor a transaction for the right reason, they are going to do so for the wrong one.

This is the main issue, allowing a third party make unilateral decisions on how you spend your assets is not advisable. If censoring addresses becomes a trend among exchanges it could lead to then asking to verify and whitelist recipients of funds from their website even if owners of such addresses don't use their platform.
It could also give their customers an impression of faux safety, so any address they're allowed to send to is considered legitimate.

[tomahawk9]

the timing of the twitter hack came in clutch for Coinbase as they were in deep waters (i think?) given the "controversy" about the company "selling blockchain analytics software to the US Secret Service", but a few days later "hey, they saved the users money so it's all good, no?"  

Not your keys, not your bitcoins.
I don't care what they did or how. It was unethical. Censor transaction of a client could even mean a violation of the ToS.

heh! yeah i still remember that quote, you remember the "get btc and be your own bank" one? funny how the narrative has changed, right? nowadays you barely see those quotes, now everyone's embracing the banks and centralized exchanges, and Coinbase is literally acting like a bank now by freezing their customers acc (which begs the question of whether they violated the ToS like you say or not, banks usually stop any movements in an acc they deem as compromised/suspicious)

I hope this news will be an eye opener to those who were looking for financial sovereignty, found out about btc and thought keeping the coins in a "trusted exchange" was a good idea. Most bitcoin newcomers that are trying to keep their money outside of the system still don't know that they [exchanges] have as much power over their coins as the banks have over their accounts

[alani123]

<...>
Sure Coinbase has other unethical practice. Maybe their mere existence as a wallet is counter-intuitive for BTC, but preventing theft isn't unethical. Unless we bitcoiners want to build a new book of ethics ofc.

If I had an account at coinbase, my interaction with coinbase would be regulated with an agreement. The agreement, in loos terms, requires them to execute my orders.
If I give them the order to payt a scammer, why should they block this order? Maybe I am happy to be scammed, maybe I owe themy money because they lent me money before, or any other unknown reason.

It's the contract, not they willingness to protect me on my behalf that must regulate their actions.
Because once you allow them to censor a transaction for the right reason, they are going to do so for the wrong one.

Those are some big maybies, and while I would agree that Coinbase COULD in theory be 100% neutral as a wallet, I don't think it would be the right thing to do for a company.
My observation was from a point of view regarding ethics. For everything else, there's competition among wallet software where each developer (or open source user) can code his wallet to act as he wants. So in terms of bitcoin as a whole, there's no issue of censorship slippery slope under this hypothetical. Aside of that, I ain't worried of customer protection under the pretense of a company and users of their services.

[akram143]

Surprised when I read this news and was thinking that all exchanges should take steps in future like coinbase. Coinbase prevented 30 bitcoins($195000) of their 1000 users.

Source. https://cryptodaily.co.uk/2020/07/coinbase-hackers-users-twitter

I do noticed that warning on my coinbase app and its really good news that they saved some innocent users from being victims.As others said it has bad side as well and we can't expect much of freedom when we use centralized wallet services that is why we always should own a wallet not an exchange based wallet for storing coins.

[aundroid]

If I had an account at coinbase, my interaction with coinbase would be regulated with an agreement. The agreement, in loos terms, requires them to execute my orders.
If I give them the order to payt a scammer, why should they block this order? Maybe I am happy to be scammed, maybe I owe themy money because they lent me money before, or any other unknown reason.

Did they now officially block the orders?
At first I thought maybe they simply showed a pop up message like "You are about to send your BTC to a scammer. Do you want to continue with this?".  
Well, since we are in a bitcoin forum here, I strongly assume that no one considers it a good thing when their orders can simply be stopped.

[The Cryptovator]

If I give them the order to payt a scammer, why should they block this order? Maybe I am happy to be scammed, maybe I owe themy money because they lent me money before, or any other unknown reason.

You are right, but you know this is a centralized exchange. I can't see any valid reason to disagree with them except to centralize regulation. We must say that they took the right and real-time decision to save their customers. They didn't prevent you to spend your money, but they prevent you from scammers which you aren't aware of really. If you were really happy to scammed or owe money, then it wasn't difficult to withdraw another address then send it to the scammer. They have notified to their users why they prevent sending funds to the scammers. I had seen warning noticed when open coinbase wallet.  

[fillippone]

<...>
If you were really happy to scammed or owe money, then it wasn't difficult to withdraw another address then send it to the scammer. They have notified to their users why they prevent sending funds to the scammers. I had seen warning noticed when open coinbase wallet.  

+2 Merits for the positive contribution to the thread.
-1 Merit for still being a Coinbase Client.

Regarding the fact they blocked only the scammer's address, leaving ample way to circumvent this block, changes almost nothing in my view.

I understand mine could be seen as an "extreme" position, but I have more than enough of people pretending to take care of me on a non explicitly requested manner.

[Sanugarid]

While coinbase has done great in this particular incident, but you have to look at the flipside as well. A central business authority prevented users to use their own money for whatsoever reasons. For this incident, Coinbase deserves a thumbs up, but in general, someone else controlling your money in a nutshell and they have the power to decide when and where you can spend your own money!

Not being pessimistic but that's the reality.

Hoping that most of the exchange are responsible about its customers safety and monitoring of scam transactions.

Exchange is not responsible of their customer when they are out of their hands, what did the coinbase do is that they warned their customers about the ongoing attack on twitter leading to a less casualty on their clients. I didn't know that the coinbase did it actually, coz I'm not subscribed to coinbase but as for the article it isn't just coinbase exchange that did this, there are also some like Gemini and Kraken exchange. Good job for these exchange, this might give the others an idea on how to take care of their client even when out of their responsibility. And as for a scam is concerned, an exchange is not made for flagging a scam, they can warn but they can't accuse.

Coinbase exchange will surely have a massive increase in its reputation as it prevented users to engage in a harmful scams where they will lose their money.

Reputation is what an exchange needs, and talking about reputation coinbase has already a lot of it.

It is not only those victim's fault, but also Twitter's, their platform should be accountable about these scenarios where people don't feel any comfortableness in using their platform. I don't really believe that it is not their fault, scammers used a high profile personality that's why believing in that tweet is easy for those people who trust easily.

There have been cases like this before if I'm not mistaken, I guess twitter is more prone to this incident because they are decentralized. Ever wonder facebook has less events like this? count their servers  

[spike420211]

Not your keys, not your bitcoins.
I don't care what they did or how. It was unethical. Censor transaction of a client could even mean a violation of the ToS.
Simply, better fall in a scam hodling your money in your wallet, than being babyguarded and having your transaction censored.
If you allow to censor your transaction once, you are allowing to do that everytime.

Coinbase the most anti-Bitcoin organisation. Make #DeleteCoinbase great again

I like what you said. But if you sent your bitcoins to the exchange, they are technically no longer yours.  

I think some people really need a baby sitter. I don't think that those people who wanted to send their BTC are examples of high intelligence.
And when you consider that they risk keeping their funds with a third party, the best thing a third party can do is to protect their users from scam.
Even in such an unethical way.

In my opinion, keeping bitcoins on the exchange in itself is not ethical.

[The Cryptovator]

+2 Merits for the positive contribution to the thread.
-1 Merit for still being a Coinbase Client.

You will +1 it if you know the fact why I am using coinbase. I am not using it's a wallet to store my coins. Coinabse is most popular in my country due to the fact of peer to peer free transactions. All bitcoin resellers in my country use coinbase to buy sell bitcoin. On the other hand, its instant peer to peer transaction made it easier to deal faster and save transaction fees. Of course, I never hold for a longer or a big amount. For example, I received a signature reward in coinbase and sell it instantly to local resellers without fees. If I receive my rewards to electrum then I have to pay transaction fees during the sale my funds. I am not encouraging to use coinbase or any centralized wallet, but the fact I told why I am using it temporarily. Just a question, why should I pay transaction fees for a small number of funds when I could deal it free and instantly?

[fillippone]

+2 Merits for the positive contribution to the thread.
-1 Merit for still being a Coinbase Client.

You will +1 it if you know the fact why I am using coinbase. I am not using it's a wallet to store my coins. Coinabse is most popular in my country due to the fact of peer to peer free transactions. All bitcoin resellers in my country use coinbase to buy sell bitcoin. On the other hand, its instant peer to peer transaction made it easier to deal faster and save transaction fees. Of course, I never hold for a longer or a big amount. For example, I received a signature reward in coinbase and sell it instantly to local resellers without fees. If I receive my rewards to electrum then I have to pay transaction fees during the sale my funds. I am not encouraging to use coinbase or any centralized wallet, but the fact I told why I am using it temporarily. Just a question, why should I pay transaction fees for a small number of funds when I could deal it free and instantly?

Because you are KYC'd on coinbase and they are actively tracking your coin movements before and after the transaction with their exchange. You Their targetsclients might not fall immediately, but youone day, one of them will eventually do something stupid. Like consolidating their pocket money they got from the EARN money with their big stash without passing trough a Coinjoin service.
So you are effectively trading your future privacy for an immediate discount on the transaction fees.
You might be aware of this trade, as a sensible person reading bitcointalk.org: it's not clear everyone else is.
Trading privacy for a little convenience is one of the mostly underrated errors in privacy management.