Be careful where you access your Coinbase account...
As if worrying about hackers wasn't enough, there is also another wrinkle that virtual coin investors need to be aware of...
Traveling to and accessing your account from a country that is currently under financial sanctions by the U.S. could be very costly.
A man from the UK recently had to learn this the hard way...
After taking a vacation in the Caribbean Islands, Elliot Smith, a visual effects programmer, was sitting in the airport when he decided to check his Coinbase account.
He logged in to the Coinbase app, no problem. Then he checked his Bitcoin holdings and a few seconds later closed the app.
He didn't make any trades or do any activity on his account, just simply logged in.
Apparently that didn't matter...
When Smith got home and tried to log in to his Coinbase account again, he saw this message:
Ouch!
Talk about a major kick in the groin coming home from vacation.
Cuba/The Caribbean isn't the only one...
Iran, Syria, and North Korea are also not fully in the good graces of the U.S.
According to Drew Hinkes, a partner at Berger Singerman (law firm), this isn't all that surprising.
According to him:
"Regulated entities, especially those in financial services and if they're doing proper OFAC compliance, are going to be looking for virtual currency assets in those nations."
Coinbase is one of the few regulated digital currency exchanges in the U.S. and they have taken great pains to stay in the good graces of regulators judging by some of their prior actions.
The issue still hasn't been resolved yet.
Companies are supposed to get special licenses in order to do business with citizens in countries such as these. The interesting thing about this particular situation is that Smith doesn't even live in Cuba, he was just visiting.
He even told Coinbase as much in a detailed message to their support staff on May 22nd.
A few days later he received this response from Coinbase:
"Having investigated the issue, I am working with a specialist to address it properly. We will follow-up with you as soon as we have an update."
It's been almost 2 months and Smith still hasn't heard back since. During this time he has sent several more requests for updates...
The lack of a response isn't so much of a dig at Coinbase though, but the entire crypto exchange space.
The customer support is terrible with just about every exchange out there. Not to mentioned the wallet issues that Steem owners in particular have had to deal with without much explanation.
In general, all too often customers are just left hanging any time an issue comes up.
This is mostly because of the massive increase in growth the space has experienced over the last 6 months.
Coinbase even admitted as much.
Daniel Romero, the senior vice president of operations at Coinbase had this to say:
"The honest answer is that we've had a tremendous amount of growth, and didn't have enough support staff and compliance staff to handle the amount of requests on the platform."
Specifically, Coinbase as seen a 10x increase in the number of customers using the platform over the last several months according to Romero.
Light at the end of the tunnel?
Coinbase and Romero say they are working on the issue.
On June 2nd, Coinbase CEO Brian Armstrong outlined how the company would be addressing the situation in Q3 of this year. The plans include committing significant investment towards customer service with a goal of handling most support requests within 6 hours.
In order to make this happen, the plan is to work with an outsourced team to double their support capacity and then also to introduce phone support for their customers.
Coinbase said they plan on doubling their support team again in the next 6 to 8 weeks.
Hopefully Poloniex and some of these other exchanges plan on doing the same because they are undermining confidence in the entire crypto space at a time when it is getting the most face time in it's history.
Stay safe and informed my friends!
Sources:
http://www.coindesk.com/coinbases-cuba-problem-says-bitcoin-business/
Image Sources:
http://destinationvows.com/popular-destinations/caribbean-islands/
http://www.coindesk.com/coinbases-cuba-problem-says-bitcoin-business/
http://www.canadim.com/express-entry-light-end-of-tunnel/
Follow me: @jrcornel
Yep, don't keep your coins on exchanges unless you are planning on making a trade, or in the case of coinbase, want to withdraw funds to your bank account
Don't do it! Get a hardware / paper / brain wallet and be your own bank!
Yes, great advice.
Hell, even keeping your crypto on an application like Exodus would be better than coinbase.
Even if you have ETH or LTC ?? I am preparing an offline wallet to store my BTC in view of August 1st event!
If you store any coins, (ETH, LTC, BTC, whatever) somewhere online, you don't have any security. Exchanges go out of business, governments shut them down, they get hacked, you name it. If someone other than you has your private keys your money is comprimised
Not really. Coinbase support has been terrible for at least five years (and likewise the situation is comparable at some other well-known exchanges). The massive growth is just the excuse du jour but if you take a longer term view the underlying problems go deeper than that.
This has just open my eyes to be so much more vigilant. I visit Cuba often also. Thanks for informing us with this great post.
Yes, it sounds like this is very applicable to you. Be careful!
Good to know not to use coinbase :)
Well last time I tried to contact coinbase support for something I got a response that the email support is closed and I need to fill up a form of some sort.. I don't like this platform one bit.
Wow very interesting post @jcornel. I never knew they could actually do that. Poor guy didn't even think he was doing anything wrong.
waw ...haven't thought about hhis but it seems logic
I don't keep my crypto in coinbase i have it in my ledger but i do have few hundreds of dollars in coinbase that i don't want to lose and also that is the main way to cash my cryptocurrencies to my bank account so i wouldn't want to lose it
thanks for the head ups
resteemed and upvoted
Once again, the answer to this is simple: Fully decentralised exchanges and wallets. Both exist already for years. But I confess, that people still think they are hard to use. They are not, but the reality is that little use them.
This happened to me once on Poloniex whenever I used a VPN to log on accidently. (forgot to turn it off) It was a hassle to get everything sorted.
useful topics. Thanks for sharing.
upvoted...
resteemed.
Thank you!