Coinbase Impersonators Swipe $1.7 Million From User

Sahana Kiran
Source – Coinbase Blog

Top cryptocurrency exchange Coinbase has been making headlines but for the wrong reasons. The market is currently undergoing a downtrend amidst this, an investor claimed that they had lost $1.7 million due to a scammer posing as a Coinbase employee. The fraudster allegedly pretended to be from Coinbase’s security team when they contacted, and they also sent the victim an email purporting to be from Coinbase. The scammer told the victim that they were “speaking to an official representative at Coinbase.”

The scammer revealed that the transactions going out of this wallet. The fraudster noted that the wallet was directly connecting with the blockchain. The investor then received an email that appeared to be from a Coinbase employee and even included a transaction that had been sent out.


The next step required the victim to input their seed phrase. This was done to block the transactions. They knew it was unsafe, but they inserted part of their phrase, believing the victim may still save their money. But the victim says that they never submitted the whole thing. A few hours later, their wallet had been empty of $1.7 million.

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Behind the Scam

The CEO of Hiro Systems, Alex Miller, stated that even in the absence of submission of the seed phrase, these websites “are capturing data as you enter it.” The victim’s partial disclosure of their seed phrase seems to be sufficient for “the bad guys [to] brute force the rest.” Miller revealed that he had just received a similar fraud from a con artist posing as Coinbase. He added,

“Specifically, they were using the Coinbase API key connecting to CoinTracker to verify that they were me (in addition to other info). At the very least cycle your API keys if you have been using CoinTracker.”

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