Coinbase freezing funds because there's no official documents of betting.

[Franctoshi]

This is very bad PR for Coinbase, honestly. But also, let us be honest with ourselves. Who will have allowed to have so much money in a centralized exchange like Coinbase? All that money was supposed to be transferred to a personal wallet. Anyways, it is not the person's fault. It is Coinbase's fault. And also, I believe the casino should take some responsibility and give us some kind of report so we can justify our winnings through the years so cases like this doesn't happen anymore. It's only my personal opinion about this situation.

I'm really wondering too why this gambler chose to store directly to Coinbase money that should have gone straight to his personal wallet and then before transferring to Coinbase if necessary or to any other exchanges of his choice; we're talking about $900k here, almost a million dollars. Coinbase would definitely put eyes on such a transaction of funds and requests for proof of funds. Some dude in crypto doesn't just know the right thing to do, and if these funds are legit, he must have learned a lesson of his life.

[stompix]

Edit: Since people don't read the comments, i am pointing out in here that. Iranus already provided the update, confirming that this was money laundering attempt.

What proof?
He used a VPN and fake ID to play on stake because he is an US citizen, nothing else!
What proof of money laundering is that?
You actually know what money laundering is?

Guys seriously, he has a public profile on reddit:
https://www.reddit.com/user/Tricky_Werewolf_1954/

That user has been playing with thousands of dollars bet for years, do you think this is how a mule would try to launder money?
By flaunting his wins over Reddit? Lol!

[Crypto Library]

Edit: Since people don't read the comments, i am pointing out in here that. Iranus already provided the update, confirming that this was money laundering attempt.

I am really surprise to see that even the money launderer who  use the centralized exchanger for the deposit. Because in all these cases, if he pays money through a casino or any other means, they use various mixer services to make his money untraceable, and here we see that the money launderer himself has deposited such a large amount on a strict exchanger like Coinbase.
And at the same time, I also want to say, is it right to call him a money launderer? Because what he did was play casino games with a fake ID, which is breaking the rules, but I don't know if it falls under money laundering.

Anyway, I just faced a freeze on my kucion for the payment of the $30 Mixer Signature Campaign and was asking me to show everything from my location to my bank statement, so I did exactly what yahoo62278 did and I also gave up hope of the assets that were in that account. Where I faced account freeze for just $30, it is normal to face freeze for $900 thousand.

[Dogedegen]

But he made the bets and won right? Coinbase just sees this as an opportunity to grab the money for themselves since the affected personal isn't also clean himself.

He has learned a very sad lesson, this is why you need to be truthful in everything you do, why is he using VPN to place bet? Why the fake ID too? I can't say he deserved it but I might, because he had all the chances to have slowly withdraw his money from Coinbase.

The lesson number 2 is never trust any centralised exchanges with your money, clean or not clean I don't care, always take your money off exchanges either big or small, these people owns the key of every deposit account on the exchanges.

No, users need to stop with this evil talk about companies that comes with no proof at all. Coinbase does not care about this small user in particular, to their money making operation he is nothing. It is like $2 to me, what do I care about it?

Coinbase must comply with the law, and at times this requires them to be strict. This case here is very suspicious, and many times when I read cases like this in the public it was always something suspicious or wrong with the situation. Some people in the thread say that it was a money laundering attempt, but even if it wasn't it does not mean that Coinbase is not right to freeze it. There could be 2 other simple explanations, his wins are not legitimate because he is using a fake ID and VPN to bypass some restrictions as someone has posted as one theory. If this is true, all his winnings are fraudulent and should be taken away from it. The other is that Coinbase might have terms and conditions that discourage depositing gambling money directly to them, and in that case they are right too to freeze his funds.

It is like going to your local bank and telling them I got this money from drugs, please deposit them to my account. When they call the police and freeze your account, you act surprised and blame the bank! 

[OgNasty]

Wow. I guess you should be careful when it comes to Coinbase. I think there must be a little more to this story than what I read, because I doubt Coinbase would steal all of someone’s money just because a deposit was made, regardless of where it came from. Something to be aware of though. Protect your deposit addresses I guess.

[henmark]

Let me start by approaching this in good faith and assume that user is not lying. Then only thing that would work their favor is to keep as detailed data of their betting history as possible.

I believe that in regulated casinos, you can ask for all betting data. At least EU citizens have law on their side and casinos are required to give all the data they have about the user activity if they choose to request it. That can take couple of months, but resolving these issues take time anyway.

Either case, imho the issue to resolve is with the casino, not with the exchange. Exchange is just following the law and won't be accepting vague data, because it's their license on the line.

But in this case, i genuinely believe this is about money laundering. Because why wouldn't the user contact to police or a lawyer if the money is legally theirs?

Well, despite the fact that it was a money laundering attempt, one should never keep their funds in a centralized exchange platform, especially if the funds are significant enough, because this might have been a suspicious case, but such things can also happen with anyone who have clean money but not enough evidence to prove the source of those funds, and at the end of the day, why use crypto instead of traditional systems if you are willing to provide so many documents and proof and whatnot to prove that the money belongs to you actually?

I'm not saying that Coinbase is wrong, or any exchange would be wrong to ask for such details when a person keeps making large deposits without providing them with valid proof or documents proving their ownership of the funds, but I'm just saying that we should avoid keeping idle funds in centralized exchanges in most cases, especially when casinos and gambling are involved.

I also wonder why a casino wouldn't provide a gambler with betting history or official records if they have already allowed the user to gamble with them for so long?

[Patikno]

Let me start by approaching this in good faith and assume that user is not lying. Then only thing that would work their favor is to keep as detailed data of their betting history as possible.

This user claimed to have won $900000 from offshore sportsbook.

However checking his past post history revealed the actual truth.

This guy had been betting from USA using VPN and fake ID!

Consequently no casino would provide him with official betting history and documentation. lol

Wow, I think he is engaged in illicit activities, from illegally using fake identities and using VPNs to disguise himself, all of which have gotten him into even more trouble. If that is really true, I don't think he will ever get his funds back because of his illegal actions. How can he possibly escape this ? I think it is impossible; he is broken so many rules.

The valuable lesson we can learn from this case is to avoid doing anything illegal, so you won't face the consequences. As the saying goes, "No matter how good a squirrel is at jumping, it will eventually fall".

[Yablee0]

My own is that,  if a platform doesn't permit you to use their service, the safest approach is to respect the the restriction instead of trying to bypass it using a VPN and fake ID.

Aa simple as this. Instead of trouble or to start experiencing some kind of difficulties when trying to withdraw winning or probably a senero like this.

However, some gamblers love adding to their stress because what's the point, If a particular casinos isn't letting you access due to policy's or whatever you can move on to the next one cuz there are like thousands of it all over the place. The fact is that if you haven't gone through the inconveniences as a result of this then you wouldn't understand what I'm talking about.

[Nightwatchmare]

Since Coinbase is already suspicious of how the guy got the $900,000 and asked him to show source of the money, and as the guy showed Coinbase the proof of his deposit, bets, and withdrawals, and yet it was not enough to convince Coinbase that the money is not money laundry, and since the casino where the guy won the $900,000 cannot give him official documents showing years of his bet history which could serve as source of the money and evidence for Coinbase to open his closed account, if the guy knows the money is a clean money he should sue Coinbase.

[Johnlomape]

Since Coinbase is already suspicious of how the guy got the $900,000 and asked him to show source of the money, and as the guy showed Coinbase the proof of his deposit, bets, and withdrawals, and yet it was not enough to convince Coinbase that the money is not money laundry, and since the casino where the guy won the $900,000 cannot give him official documents showing years of his bet history which could serve as source of the money and evidence for Coinbase to open his closed account, if the guy knows the money is a clear money he should sue Coinbase.

This is not the first time Coinbase has been accused of freezing users accounts for inefficient reasons. What does an exchange have to do with users source of income, truly this does not really make any sense at all. These frozen funds will be sent to where?
I hate it when I see exchanges trying to act like police freezing users funds with stupid excuses. Exchanges are not supposed to have the jurisdiction to free a customer fund without a court order. They are only acting out of greed to steal funds from their users.
This money is big and shouldn't have been frozen. I think Coinbase need to be sued for restricting there user from withdrawing his money.

[Somegory]

OP already said that this is money laundering attempt, I don't see that coming, and this is the problem I have with some gamblers trying to pretend as if they are innocent, see as he came out in the public talking like Coinbase is the bad platform here.

I don't mind though, because Coinbase is also a centralised exchange like many others, I don't advice leaving any digital assets on Coinbase, it's not making sense, Coinbase might collapse and before you react all your coins is gone.

What OP did is very wrong but at the same time leaving your coins on any crypto exchanges is also very wrong.

[fighter2627]

Whoa! 900 000$ is a very huge amount of money, it's not a joke actually. There are many questions that come to my mind when I read that, actually. First, why did they put
such a large amount in coinbase?

Of course, the first thing that people will immediately think of is money laundering, especially if they see it coming from gambling, there are many corrupt politicians who do such a thing even
in our country, where they will be able to bribe the owner of the casino, but with an exchange like coinbase, this is where the problem will really arise. But the question is if the real owner can't get it back, who will benefit from the 900 000$ in coinbase? The owner of coinbase got it without any trouble or it's just easy money on their part, as if they legally took money that wasn't theirs?

[SuperBitMan]

if the guy knows the money is a clear money he should sue Coinbase.

Thank you so much, you have said what was on my mind and this is the only solution right now for him. If he knows the money is clean, the next thing to do is to sue Coinbase and when he sues them he’s going to get back his money and Coinbase is going to pay for damages they have caused him, and don’t be surprised Coinbase may end up spending or paying him $2 to $3 million for damages.

[Hatchy]

The owner of coinbase got it without any trouble or it's just easy money on their part, as if they legally took money that wasn't theirs?

I don't really think money laundering would be the first thing that comes to mind. Since he literally sent the money from a betting platform to a centralized exchange like Coinbase, it was most likely just a regular investor moving his funds. The only problem I have with him is that he should have been aware that Coinbase does not allow funds coming from betting platforms.A few weeks ago, my exchange sent me a list of services that they don't allow deposits or withdrawals from. These are the kinds of updates we should always try to keep up with.

[Salahmu]

if the guy knows the money is a clear money he should sue Coinbase.

Thank you so much, you have said what was on my mind and this is the only solution right now for him. If he knows the money is clean, the next thing to do is to sue Coinbase and when he sues them he’s going to get back his money and Coinbase is going to pay for damages they have caused him, and don’t be surprised Coinbase may end up spending or paying him $2 to $3 million for damages.

Yeah suing the exchange is also good but it wouldn't also guarantee his possibilities of recovering the money from the exchange because they wouldn't hand it over to him without proving that the money actually came from the betting source he claimed and if he could not proof it he is likely not going to win the case against them, any exchange could have actually done the same thing as Coinbase because this is almost a million dollar in one user accounts, they will definitely want to know how he got it, the only option he has is to look for those wining bets and present it to them.

[gracreavix]

Sure it has been confirmed that it is money laundry. But we shouldn't just assume all coinbase freeze related to gambling is money laundry. We should still be observant and do what the OP said about keeping record history of your bets. Very important. As for coinbase, good job on freezing such funds that can be used to fund a potential harm.

[CryptoHeadlineNews]

Such regulated centralized wallets/exchanges are well known for difficulting access between their customers and gambling platforms, so they should be completely discouraged for gamblers.


For someone who has 900,000$ in holdings, it shouldn't be an issue to acquire a hardware wallet which he completely own the keys and access to the money. It would have saved him that fortune, besides avoiding the regrets, frustration and headaches which must have come in the sequence.

It's an important warning for everyone: be careful where you deposit your money, because you may be unable to retrieve it later...

Not getting a hardware wallet was one of the biggest mistakes that Reddit user made. Because looking at the whole scenario, it is obvious this might have been the first time putting such a huge sum of money into his Coinbase account, knowing fully well he won't be able to have the ultimate control over it. Because if he had been a regular user of Coinbase and deposited an average of $1,000 to $10,000 frequently, he might have seen all the signs that Coinbase is not the type of wallet where you keep a large amount of Bitcoin without proper proof of funds to back up your claims when needed. But however, this is another sign to proof that non-custodial wallets remain the best place to keep large amount of bitcoin. 

[mak013]

Edit: Since people don't read the comments, i am pointing out in here that. Iranus already provided the update, confirming that this was money laundering attempt.

What proof?
He used a VPN and fake ID to play on stake because he is an US citizen, nothing else!
What proof of money laundering is that?
You actually know what money laundering is?

Guys seriously, he has a public profile on reddit:
https://www.reddit.com/user/Tricky_Werewolf_1954/

That user has been playing with thousands of dollars bet for years, do you think this is how a mule would try to launder money?
By flaunting his wins over Reddit? Lol!

I don't get why this is called money laundering. At the same time, he's breaking the ToS and U.S. law (if I understand correctly, he'd have to prove where the money came from if asked). So he has two problems here: one with the casino (which seems solved if he withdraws the money) and one with the exchange.
And here's the most interesting part: does the exchange really need his bet history, or does it just want to steal his money?

[ColdLava40]

This is just a warning to those who gamble on offshore platforms and use fake ID or VPN on sites that don't allow it mostly as it concerns crypto currencies that is much watched these days.

I don't even know how it got piled up, but he surely didn't put them there at once.

So many zeros to be messing around with on centralized systems. This is something that makes me run away from anything centralized.

I don't even see why I would have such amount of money and want to give control to a site, more worse Coinbase. Now since the money is coming from his gambling they will find more faults to validate their actions and withhold his money from him.

The solution? Avoid giving control of funds to their party.

it never ends well, not for long.

[Fortify]

This is one reason why one should keep a detailed spreadsheet of your betting history.

Let me start by approaching this in good faith and assume that user is not lying. Then only thing that would work their favor is to keep as detailed data of their betting history as possible.

But in this case, i genuinely believe this is about money laundering. Because why wouldn't the user contact to police or a lawyer if the money is legally theirs?

This is a perfect example of a situation where the person should have self custody. There is no reason to have a near a million dollars in any exchange account. Coinbase is a probably the largest publicly traded companies in the crypto space and they want to hold on to that status so are bound to do spot checks on customers like this. The US regulators (or those from any country) are bound to have a keen interest in somebody with an account that large. If you cannot prove where a large chunk of it comes from they're unlikely to release it again easily and you might actually end up having a court battle to try to regain control, but it's going to get much messier than this. Any protection or anonymity this person thought they had around holding crypto is likely to get stripped entirely away in that situation. As you say, it doesn't make much different to Coinbase who have a large legal team on retainer who are happy to handle the case and there is incentive for them to be as awkward as possible because it means they might keep it or split it with the taxman in the end.