A user shared a photo on the social network As a result of the account being frozen for more than a month, several users of the exchange spread their complaints on social networks, reflecting that they had suffered similar or identical events.
According to Jamescrowthe user affected by the restrictive measure, Coinbase did not “give any warning of this before the purchase,” referring to the possibility that they could freeze their funds. Immediately afterwards, he announced that he was going to go to the authorities to present his case, but not without leaving a testimony of appreciation to another user who spread the word about the cases.
I ended up selling and cashing out. It cost me commissions and the price dropped slightly. I won’t be returning to Coinbase anytime soon. He remains a sovereign legend.
@jamescrow, X user.
Coinbase has frozen certain account functions for some users. Source: social network X – @jamescrow
The message received by the user upon seeing their funds frozen was the following: “As a precautionary measure to protect you against potential losses, we have limited your ability to send cryptocurrencies until October 28, 2024. Please try after this date.”
Other users of the social network shared having experienced a similar event. TO C_Mitch18 It happened to him, allegedly, twice in one month. The first time it prevented him from buying and the second time from sending his cryptocurrencies. Another user, for his part, claims to have taken him five months unlock your funds.
A later group of users confirmed having suffered similar events, some lasting up to a year. Another dared to comment with concern that the exchange asked him about the identification data of the person who would receive the cryptocurrenciessuch as name and physical address.
Bitcoin-y-wallet-privada-como-metodo-de-custodia”>Bitcoin and private wallet as a custody method
In support and with words of advice, several users who participated in the discussion recommended abandon centralized exchanges in favor of those solely dedicated to bitcoin and with decentralization properties. Others recalled the importance of self-custody with bitcoin, where no intermediary participates in the process of sending and receiving money, and freezing funds is impossible.
Restrictive measures like the above, which are likely due to compliance exercises with US state authorities, make Coinbase a bank-like platform.
Banks, for example, have the power to reverse transactions when there is human error, fraud or disputes over ownership of funds. Although this provides accessibility in practice, it moves away from the original ideals that guided the construction of the Bitcoin Blockchain. Whose central characteristic is the immutability of its accounting book and, therefore, the extreme difficulty in manipulating it and changing it as neededa difficulty that is less in the banking system.
Most exchanges that exercise strict compliance give themselves the power to freeze funds and other similar practices if they deem it necessary.
This possibility is mentioned in advance Coinbase in its terms of service. Here is the proof:
Except as required by law or as provided herein, Coinbase will not sell, transfer, lend, mortgage or otherwise dispose of the Supported Digital Assets in your Digital Asset Wallet unless directed by you.
Coinbase, Cryptocurrency exchange.
These facts highlight the importance of reading the terms and conditions of cryptocurrency services before using them. Also the importance of understanding the limitations of these businesses, more useful as entry and exit ramps to fiat money than as custodians and guardians of their users’ cryptocurrencies.
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