KEY POINTS
- One user claims to have been restricted for over a year with little help from management
- Ex-NFL player Carlton Mitchell said he was restricted twice throughout September
- Coinbase is now accused of not having the reserves to back its crypto offerings
Cryptocurrency users on X are fired up after some Coinbase customers revealed screenshots of notices from the crypto giant that stated some of their transactions have been restricted.
Coinbase Reportedly Blocks Some Transactions
In one post, a user tagged G'Day Bitcoin host Sean Clarke, asking the BTC enthusiast to "spread the word" about how Coinbase restricted the user's "crypto sends" without warning prior to a purchase. The user said he will seek advice from authorities regarding the matter.
@seanclarke911 can you please spread the word about this which @coinbase has implemented. No warning of this prior to purchase. Will be going to the authorities. pic.twitter.com/8UkxEl6Ixg
— JimmyCorvidae⚡ (@jamescrow) September 28, 2024
"Crypto Sends Restricted. As a precautionary measure, to protect you against potential loss, we have limited your ability to send crypto until October 28, 2024. Please try again after this date," the notice supposedly from Coinbase reads.
Former NFL player Carlton Mitchell revealed that his transactions have also been restricted twice in the month. The first instance was reportedly on making purchases, and in the second instance, he was unable to send coins. He also provided screenshots of the transaction limit notices.
There have been two instances this month where I have been unable to complete tasks. First, I was unable to make purchases, and now I am unable to send coins. pic.twitter.com/dHtoAt67O6
— Carlton Mitchell (@C_Mitch18) September 30, 2024
Another user claimed to have been restricted for more than a year "with the same issues." He has reportedly attempted to reach out to Coinbase management but they have allegedly been telling him "to check back after a month."
Yup, @coinbase is one huge scam. I've been restricted for over a year or more with the same issues. Every time I talk to management, they tell me to check back after a month. Every month I get no where. Avoid them at all cost.
— Gablim (@gablimtaxi) September 29, 2024
Several other users shared similar experiences with one of the world's largest crypto platforms, including one that accused Coinbase of stealing customer funds "by blocking your crypto, claiming it's suspicious despite three successful KYC (know your customer) and AML (anti-money laundering) verifications."
Same here since 10 month now!!! @coinbase
— fpSPQR (@fpspqr) September 29, 2024
is a scam. They steal your funds by blocking your crypto, claiming it's suspicious despite three successful KYC and AML verifications. You guys know where these 'suspicious' funds are from? They are my leftovers from @CelsiusNetwork
.…
I’ve copped that, they think I’m to stupid to make my own decisions. Stopped using @coinbase
— EASEYOURMINE.fuel 🛸 (@easeyourmine) September 29, 2024
They did the same to me and when the date passed, they continued to restrict my account for 2 more months. Their support is useless. I had to sell everything and buy again. Super sketchy
— Serginsurge (@deltadesignz) September 29, 2024
There have also been allegations that Coinbase doesn't have the digital assets they're offering.
Warnings and Flashbacks on Coinbase Downtimes
Clarke has since re-posted about the matter, warning users not to use the platform. "This is not a good sign," the Bitcoin advocate said. "First they go down as it pumps then they prevent you taking self custody of you[r] Bitcoin," he wrote.
One user backed Clarke, citing four Coinbase shutdowns "when Bitcoin pumped this year in the ATH (all-time-high) range."
Multiple other users cited the same issue: that Coinbase allegedly goes down whenever Bitcoin is pumping or goes higher.
They've been learning from SBF on how to trade with millions worth of their customers Bitcoin. Every time there's a pump Coinbase have to shut down. Every time. There's a reason. They don't have the Bitcoin.
— CY (@CYcryptox) September 29, 2024
I had this issue in March, I eventually got all my coins off and have been trying to warn others. This is the next bear market narrative. 'Coinbase freezes users accounts.' I can just see it
— Bitcoin BeachBum (@BeachbumBTC) September 29, 2024
The Issue of 'Legitimate' Accounts
Prominent analyst Adam Cochran has weighed in on the matter. He explained that Coinbase issues restriction notices based on two things: first, a potential account compromise, and second, when there is a potential KYC/AML violation. He added that "durations increase with severity risk."
Coinbase does these types of restrictions when it’s:
— Adam Cochran (adamscochran.eth) (@adamscochran) September 30, 2024
A) Detected a potential account compromise.
B) Detected a potential KYC/AML violation.
Durations increase with severity risk.
Legit accounts have no problem getting this resolved.
Is it a bit annoying? Sure.
But if… https://t.co/EQfUrkeKHZ
Cochran also said "legit accounts" won't have issues resolving the limited transactions with Coinbase, noting that if some users are struggling to get the restrictions lifted, "it's very likely you've repeatedly interacted with a bad address on-chain."
Coinbase did not immediately respond to International Business Times' request for comment on the matter.
