Yigit Taha OZTURK 
In the ever-volatile crypto world, not all shocks are about price swings. Some cut deeper, striking at the core of user trust and regulatory confidence. This week, leading crypto exchange Coinbase faced a significant dual crisis that rattled both investors and the industry at large.
A data breach involving customer information, coupled with an ongoing SEC investigation into potentially misleading user statistics from 2021, led to a sharp market response.
Shares Slide 7% Amid Rising Concerns
On the evening of May 15, Coinbase stock dropped by 7%, falling to $244 in after-hours trading. Two simultaneous developments triggered this decline:
- An investigation by the Securities and Exchange Commission (SEC) into Coinbase’s previous claim of having over 100 million “verified users” in 2021.
- A serious data breach caused by compromised third-party support staff.
The SEC has questioned the accuracy of these user metrics as part of a probe that began during the Biden administration. Coinbase stopped reporting the metric in 2022, opting instead to disclose “monthly transacting users,” which it deems more relevant.
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Chief Legal Officer Paul Grewal stated that while Coinbase disagrees with the continuation of the investigation, it will fully cooperate with the SEC to bring it to a close.
Ransom Refused, Compensation Expected
In a separate incident, Coinbase revealed that attackers used internal support access to leak data from a limited number of accounts. The attackers demanded a $20 million ransom, which Coinbase firmly refused to pay.
However, the company pledged to compensate affected users, estimating total remediation costs to range between $180 million and $400 million.
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