"Funds are SAFU": Here we go again, but with Coinbase!

[philipma1957]

It is about ratios.

Simple setup below

exchange 1) 10% max of your coins
exchange 2) 10% max of your coins

wallet 1) 40% of your coins.
wallet 2) 40 % of your coins.


I have zero issue using coinbase because I do not keep a lot of coins there.

I keep more cash which is insured by fed gov.

low coin which is not insured by fed gov.

So when coins case froze  I knew my usa cash was safe.

I always have a bit of coin on ladder sales.

but I never have it all at coinbase

or even half with coin base
or even a third with coin base
or even a quarter with coin base.

I have 14% on coinbase but most is in cash


6% of my investment is coin
8% of my investment is cash this is on coinbase

86% of my coins are in wallets

[1714774906]

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[adaseb]

They apparently upgraded their systems and can withstand 10x the amount of traffic. What I don’t understand is that why didn’t they prepare for this in the past? This happened so many times during crazy bullish or bear market moves and they knew it would happen again.

CEO said it’s a waste of money to have 10x more capacity when most of the time 1x is sufficient. I understand but at least have some workers who can monitor conditions and when they see it might be a crazy day then increase the capacity.

Imagine how much business they lost due to this.

[JollyGood]

Today there is automation, hosts can easily add and remove servers or increase/decrease cloud infrastructure as and when traffic flows change in order to keep costs down while allowing for the website not be clogged by visitors. Why was it even a talking point when it came to the Coinbase CEO?

They are representatives of companies that pay them phenomenal amounts of money therefore CEOs should be making more careful when they make statements because their words have consequences. One of the things any trading website would have to prepare for is the possibility of spikes in traffic, ignoring or belittling it is not recommended.

They apparently upgraded their systems and can withstand 10x the amount of traffic. What I don’t understand is that why didn’t they prepare for this in the past? This happened so many times during crazy bullish or bear market moves and they knew it would happen again.

CEO said it’s a waste of money to have 10x more capacity when most of the time 1x is sufficient. I understand but at least have some workers who can monitor conditions and when they see it might be a crazy day then increase the capacity.

Imagine how much business they lost due to this.

[ultrloa]

Panicking Coinbase users woke up today to find their bitcoin balances at $0 because of a technical glitch.

Source: https://www.msn.com/en-us/money/markets/bitcoin-s-price-surge-briefly-broke-coinbase/ar-BB1j4tNN

Well at least they were lucky that it was just a glitch! I will never understand why normal people are keeping their coins in an exchange and not even in a software wallet. People who are not trading coins do not need to use an exchange. It is just ridiculous seeing people on X/Twitter having a mental breakdown over this even after hearing about "not your keys, not your coins" so many times.

Usually people just want convenient and ignore the possible risk they might encounter with those exchange since they are confident to much on that platform since they think they are reputable and there's nothing wrong will happen to them. But since the incident happened it make things clear that nothing safe and even that exchange has been compromised with hacking issue. They are just using the word SAFU just to make people calm but we don't know how big the damage they get internally. Although maybe for now there's no funds of costumer at risk but due to incident happen they should know that there's no safe after all and they should not trust those exchange so they better grab more reliable wallets especially if they want to hold their bitcoin for long period of time.

[mindrust]

Panicking Coinbase users woke up today to find their bitcoin balances at $0 because of a technical glitch.

Today's glitch tomorrow's reality.

"Not your keys not your coins."

People will never learn it seems and I am not really different. I still hold some coins in an exchange even though I know that I shouldn't. But damn trading opportunities are so good and you can't make trades without you make a deposit first.

There are a few decentralized trading platforms, I should probably dig into those too.

[uneng]

Panicking Coinbase users woke up today to find their bitcoin balances at $0 because of a technical glitch.

Today's glitch tomorrow's reality.

"Not your keys not your coins."

People will never learn it seems and I am not really different. I still hold some coins in an exchange even though I know that I shouldn't. But damn trading opportunities are so good and you can't make trades without you make a deposit first.

There are a few decentralized trading platforms, I should probably dig into those too.

It's hard to completely get rid of exchanges from our routine in crypto universe. I used to keep all my funds in third party platforms, especially for passive income purposes, however, since the scandals involving big companies from the industry in 2022, I finally took the decision of withdrawing a large portion of my money from such websites and store it in a hardware wallet. Anyway, I still keep some funds in online platforms, although now I consider the risks to be more calculated and manageable than before.

If you store the largest portion of your funds safely, I don't think it's a big issue to let another portion of your money deposited at online platforms most of the time, although there are critical periods of time, such as when BTC skyrockets suddenly towards a new ATH level, for example. In times like this, it's a wise decision to store all your coins safely, due to Bitcoin becoming heavily targeted by everyone.

[Solosanz]

If you store the largest portion of your funds safely, I don't think it's a big issue to let another portion of your money deposited at online platforms most of the time, although there are critical periods of time, such as when BTC skyrockets suddenly towards a new ATH level, for example. In times like this, it's a wise decision to store all your coins safely, due to Bitcoin becoming heavily targeted by everyone.

Your points doesn't make any sense.

If the hackers can hack an exchange regardless during bear season or bull season, they will do it ASAP.

If you meant people in general or criminals that attack with $5 wrench, someone can know your Bitcoin if you share it to other people, as long as you stay private, no one will know your holdings.

[The Sceptical Chymist]

I see this thread is about a day old, and I'm never really sure about the time difference between bitcointalk and NYC where Coinbase is traded on the NYSE, but today their stock is down 2.14% as of right now.  (note: I haven't read the last page of this thread; someone might have already mentioned that, but I doubt it)

That's probably due to Coinbase's little 'technical glitch'--which isn't a glitch but sheer incompetence on Coinbase's part.  And the people freaking out about this are probably ignorant about crypto and finance in general.  They might have thought they'd been hacked, but there's no way Coinbase would get away with either stealing funds or letting a customer's balance go to zero without explanation or reimbursement.  They are accountable to the SEC and who knows how many other government agencies, after all.

And no, people should not be storing their crypto on any exchange, even Coinbase.  But there's always going to be a non-zero number of people who do exactly that.

[uneng]

If you store the largest portion of your funds safely, I don't think it's a big issue to let another portion of your money deposited at online platforms most of the time, although there are critical periods of time, such as when BTC skyrockets suddenly towards a new ATH level, for example. In times like this, it's a wise decision to store all your coins safely, due to Bitcoin becoming heavily targeted by everyone.

Your points doesn't make any sense.

If the hackers can hack an exchange regardless during bear season or bull season, they will do it ASAP.

If you meant people in general or criminals that attack with $5 wrench, someone can know your Bitcoin if you share it to other people, as long as you stay private, no one will know your holdings.

The possibility of an exchange being hacked or the exchange's owners executing an exit scam is always present, despite the scenario being a bull or bear market. However, there will be more motivation and incentive to execute a hack or scam when there are higher potential rewards to be achieved by the thieves. It's logical (and obvious) to think thieves will prefer focusing their attention and effort to thick pockets than average pockets when choosing their victims to pickpocket.

[JollyGood]

The sad thing is that in general many people simply do not learn. They have seen example after example of exchanges getting hacked yet they still opt to keep their crypto stored on them. Not your keys not your crypto does not seem to resonate with some people.

The best advice is to only use exchanges when you are about to trade otherwise there is no need to store crypto on exchanges.

And no, people should not be storing their crypto on any exchange, even Coinbase.  But there's always going to be a non-zero number of people who do exactly that.

[shield132]

Panicking Coinbase users woke up today to find their bitcoin balances at $0 because of a technical glitch.

Source: https://www.msn.com/en-us/money/markets/bitcoin-s-price-surge-briefly-broke-coinbase/ar-BB1j4tNN

Well at least they were lucky that it was just a glitch! I will never understand why normal people are keeping their coins in an exchange and not even in a software wallet. People who are not trading coins do not need to use an exchange. It is just ridiculous seeing people on X/Twitter having a mental breakdown over this even after hearing about "not your keys, not your coins" so many times.

If I remember correctly, two years ago they had a glitch but that glitch was very positive for customers. Georgian national currency was priced 100x more than it was. E.G. 1 USD was equal of Gel 290 instead of Gel 2.90 and that let Georgians to make 100x profit out of thin air.

Btw Binance had similar glitch in 2021 and even more dangerous was the moment when Bitcoin crash after Elon Musks's and China's statement and it was impossible to sell Bitcoin while the price was crashing and crashing because their servers and system went down.

Btw I don't understand why people ignore not your key not your coins advice. FTX went down and people still hold most of their coins on exchanges, so, this small glitch is not going to change their mind.

[Ultegra134]

It's because most of Bitcoin holders are know or interested with Bitcoin in 2017/2018 during Altcoins season and Bitcoin price able to reach $19K, it's a big milestone at that times. Mt.Gox was a biggest exchange during early days, but in 2014 they gets hacked and they're bankrupt. Most people not aware with this case, since they're know Bitcoin in 2017, it makes them always think Binance is the first, popular and biggest exchange, since they still exist until now, there's no problem to hold the coins on Binance.

So we're need to wait when Binance become Mt.Gox 2.0, I'm sure we will see a chaos.

I don't think Binance will become Mt.Gox 2.0, it's the largest exchange in trading volume, and supposedly the most trusted one as well. If that happens, the whole cryptocurrency world will be permanently dented, no one would trust them anymore and they'd eventually collapse, along with other exchanges due to the chaos Binance's fall will cause. On the positive side, I don't believe it's a possible scenario, I highly doubt Binance would fall, however, I don't support storing large amounts on exchanges, despite their status.

[tabas]

I had no problem with Coinbase or any exchange having such issues with these on important days. Because I don't keep my funds there but it's alarming that this keeps on happening. Selling through those integrated exchanges on wallets are way too high for the conversion because they get % for each sale and that's also regretting upon calculation of that amount. The customers can't do anything with this when another skyrocket happens and they show bugs because they don't want people pulling out their funds after selling it on them. That means that money flowing out of them also losing them money. That's why some technical maintenances are like their slowdown to their customers and to calm the fluctuation of visits on them. But that's unethical when it happens mostly on these bull runs that we're having. SEC or any agency of the government that are monitoring them should step in and force them to stop from doing it.

[southerngentuk]

So, the whole Coinbase "glitch" where folks saw their accounts vanish got everyone freaking out again, right? It's like a record player skipping, but instead of your favorite jam, it's your life savings on repeat. Scary stuff. This whole thing reignited the debate about keeping your crypto on exchanges versus those fancy non-custodial wallets. Let's break it down, homie to homie.

Exchanges are like the corner store for crypto. They're convenient, user-friendly, and have everything you need to buy, sell, and trade. Plus, they handle the technical stuff, perfect for crypto newbies. But here's the catch: you don't actually hold the keys to your crypto; the exchange does. This means if something goes wrong, like a hack or the exchange decides to say "adios," your coins could vanish faster than your phone battery at a music festival.

You hold the keys, which means you're in total control and nobody can touch your coins without your permission. Sounds good, right? But here's the thing: it's like carrying a briefcase full of cash – you gotta be extra careful not to lose it! These wallets require more technical know-how, and if you lose your keys, your crypto is gone forever, poof!

[Antotena]

Correct. The problem occurs when many people want to sell Bitcoin when the price is high but don't want to bother with the rising price movement of BTC, in my opinion it's exactly as you said above, it's better to join an ETF and don't worry about protecting our own wallet and have to do very technical things, But what @NotATether said is also very true because it is often talked about and the importance of controlling your own coins without relying on exchanges.

You can buy Bitcoin as low as $10 worth of Bitcoin on any centralized exchange but I don't think Blackrock is going to allow them to do the same. I personally will allow them stay with centralized exchanges to experience a little feeling about how Bitcoin really works instead of us to lose all our people from centralized exchanges to ETF too. Who knows what will come later of Bitcoin ETF because I know for a certain that the government will one day come for them for not fulfilling one thing or the other, they are never bored of disturbing Bitcoin.

I thinks the network or server rather of Counbase is experiencing over load, this is the time when they experienced large number of people and it could even double coming to bitcoin halving day, they should upgrade their serve and stop disappointing people but it's strange that of all exchange, it's that of US that is under watch that is having such traffic.

[darkangel11]

I have 14% on coinbase but most is in cash

Losing 14% would still hurt, right?
10% of a million is still 100k. It won't bankrupt you, but you can buy a very nice car with that, or a piece of land.
If you had that 14% in a physical item like a house and lose it, you'd feel it more I guess.
Also, you're talking like holding a small part of your investment on exchange makes it OK, while you could hold 0 and be completely safe.
I hold 0 on exchanges and haven't used a centralized exchange for years. When I want to sell I transact face 2 face with a broker.

[JollyGood]

I like the way you captured the numbers. No matter who it was, losing 14% would definitely hurt and without a doubt even losing 1% would hurt if it was preventable. Keeping crypto on exchanges is a bad idea unless you deposit them with the intention of trading them immediately.

In your case, if you transact with a broker in person for cash rather than use centralised exchanges it means you have to be careful meeting buyers but other than that it is a good way because it removes dependency on exchanges.

I have 14% on coinbase but most is in cash

Losing 14% would still hurt, right?
10% of a million is still 100k. It won't bankrupt you, but you can buy a very nice car with that, or a piece of land.
If you had that 14% in a physical item like a house and lose it, you'd feel it more I guess.
Also, you're talking like holding a small part of your investment on exchange makes it OK, while you could hold 0 and be completely safe.
I hold 0 on exchanges and haven't used a centralized exchange for years. When I want to sell I transact face 2 face with a broker.

[albon]

The official Coinbase support account posted yesterday an update on X in this [tweet] that the glitch for customer balances has already been restored on the platform, but what I saw from the customer comments after this update indicates how completely inefficient this exchange platform is, One person mentioned he couldn't send/transfer to another wallet, another said he couldn't trade, another couldn't log in, some demanded compensation from the platform, and others mentioned their balances appeared lower than before. Indeed, Coinbase has become a joke now, and it is worth noting that this exchange, like any centralized exchange, is prone to technical errors and glitches, and those who pay the price for this are the people who hold their assets through third parties. They will fear and panic and lose the profits they made from the rise in Bitcoin due to increased traffic affecting the exchange's services and causing glitches, and they'll face delays until the platform's specialized team fixes this glitch. This matter may also happen again in the future, with Bitcoin achieving a new ATH. I agree with OP that this time, Coinbase customers were very lucky. Perhaps next time, it won't go as smoothly.

[darkangel11]

I like the way you captured the numbers. No matter who it was, losing 14% would definitely hurt and without a doubt even losing 1% would hurt if it was preventable. Keeping crypto on exchanges is a bad idea unless you deposit them with the intention of trading them immediately.

In your case, if you transact with a broker in person for cash rather than use centralised exchanges it means you have to be careful meeting buyers but other than that it is a good way because it removes dependency on exchanges.

Thanks

As for the danger, there's none because I trade with registered brokers. These are guys that run physical exchanges in the area and trade metals, foreign currencies and cryptocurrencies. When you want to exchange a larger sum, you call them first to make a reservation and then you sit at an office and trade in a friendly atmosphere. The place I use is situated in an office building with its own underground car park and security. Nobody knows you're coming to exchange money and nobody can rob you on your way in or out.
Their fees are higher than what you'd pay trading on Coinbase or Binance, but there's no KYC and you don't get a bank transfer but cash that you can use however you like. IMO this is the safest and most anonymous way of trading.

[JollyGood]

Surely this is not the way to run a multi-billion USD$ company.

If their own customers are letting the world know about the problems they are facing, it shows they have problems. As already mentioned, maybe next time their customers might not even see their real balance again. And that does not apply to just Coinbase. People really need to start familiarising themselves with the words: not your key not your coins

Exactly how Coinbase found themselves in this public relations disaster will be investigated and steps taken to ensure it does not repeat itself otherwise Coinbase could end up losing more customers.

The official Coinbase support account posted yesterday an update on X in this [tweet] that the glitch for customer balances has already been restored on the platform, but what I saw from the customer comments after this update indicates how completely inefficient this exchange platform is, One person mentioned he couldn't send/transfer to another wallet, another said he couldn't trade, another couldn't log in, some demanded compensation from the platform, and others mentioned their balances appeared lower than before. Indeed, Coinbase has become a joke now, and it is worth noting that this exchange, like any centralized exchange, is prone to technical errors and glitches, and those who pay the price for this are the people who hold their assets through third parties. They will fear and panic and lose the profits they made from the rise in Bitcoin due to increased traffic affecting the exchange's services and causing glitches, and they'll face delays until the platform's specialized team fixes this glitch. This matter may also happen again in the future, with Bitcoin achieving a new ATH. I agree with OP that this time, Coinbase customers were very lucky. Perhaps next time, it won't go as smoothly.