Before jumping into the meat and bones of the matter, let’s take a look at what Coinbase is. We will also take a look at some of its features and most common problems!
Coinbase is one of the most popular cryptocurrency exchanges globally, serving more than 68 million verified users in 100 countries.
It went online in 2012, intending to increase Bitcoin’s reach. And it surely played a big role in that process. The exchange consistently ranks in the top 3 cryptocurrency exchanges by trading volume.
What Is Coinbase?
At this time, Coinbase supports 96 cryptocurrencies and 288 trading pairs. This is more than enough to get you started with crypto. However, you should know exchanges like KuCoin or Binance offer more options.
In any case, Coinbase is home to over $250 billion in assets. Clearly, it has been shown to provide a lot of value for many people. This exchange offers a wide variety of funding options and great geographic support.
Coinbase complies with many different regulations, including The Bank Secrecy Act, The USA Patriot Act, and most state’s regulations. Coinbase is also registered as a Money Services Business with the Financial Crimes Enforcement Network, part of the US Government.
As part of its Covid-19 pandemic response, this crypto exchange decided to become a remote-first company. That is surely a challenge to overcome, especially when having over 2700 employees. However, FinTech companies like Coinbase may have smoother transitions into getting a fully remote workforce.
It may sound strange that a company can have very few offices and still provide so many services. But nowadays, that is completely possible and incredibly common. Most large software companies have a remote or hybrid setup for their operations.
The exchange went public in April 2021, which of course, tends to put companies in the spotlight. It was also part of an attack from hackers who compromised over 6 thousand accounts.
Sometimes, an explosion of attention like this can make a company crash or face new issues. This may have happened to Coinbase since many users have been experiencing problems during the last months.
What Features Does Coinbase Offer?
One of the reasons Coinbase is so popular is because of its practical features. Mainly focused on exchanging-type of services, it does not offer mining pools, NFT marketplaces, and some options other exchanges do. This should not be an issue depending on your expected future investments but is something to consider.
Individual users can trade over 80 cryptocurrencies and use Coinbase’s software wallet. There are also ways to borrow from the company through using collateral, which can be useful. This exchange also has an option called Earn for users to gain interest from their funds.
Coinbase has a basic exchange interface and a Pro version with advanced features and insurance for user funds.
Coinbase’s Most Frequent Issues
Coinbase might be one of the biggest exchanges but is not perfect. No cryptocurrency or fiat platform will ever be. As such, there are certain issues users need to be ready to deal with at some point or another.
An example of this occurred between March and May 2021, when nearly six thousand Coinbase users had their accounts breached.
Exploiting a vulnerability in the SMS account recovery system, attackers extracted funds from all of those accounts. Coinbase worked with those users to restore access to their accounts and reimburse their funds. Still, this probably puts a big burden on many of its divisions and makes its security feel fragile.
Later this year, a large number of users reported a Coinbase account restricted problem. Coinbase often notified them that technical issues forced the site to limit account functionality while fixing them. This often meant accounts could only handle logging in and showing balances, with limited other functions.
Coinbase has also reported connectivity issues several times this year. It sounds crazy, but it’s not the first time a behemoth tech company has gone down due to technical issues. During those outages, many services were offline, sometimes including credit card-related services.
It remains an open question whether Coinbase had awful luck this year or if it’s mainly bad management. In any case, it’s understandable that many users prefer moving their assets to a different provider.
This is a good moment to remind you that storing large sums in exchanges is not the safest option. Instead, using a cold wallet is considered one of the most secure methods for long-term storage.
If you want to learn more about Coinbase, make sure to check out our in-depth Coinbase review.
Why Is Your Coinbase Account Restricted?
If you are experiencing a Coinbase account restricted issue, don’t panic. This can be solved most of the time quickly. Cryptocurrency exchanges have to perform a very complex job, and sometimes mistakes can be made. Also, as these companies serve millions of users, customer support can be overwhelmed quickly depending on demand.
There are a few things you can do to prevent this from happening to your account. Maintaining your account secure and learning about the platform and its user agreement goes a long way in this regard.
As you probably know, if Coinbase can prove wrongdoing in your account, chances are it will be closed. However, sometimes your account will be restricted as to what you can do, which often happens to accounts marked for high fraud risk.
Until the matter is resolved, Coinbase may disable its buy or sell services for your account. Even when that happens, you can withdraw funds allocated in local currency to a verified bank account.
When Coinbase decides an account will be closed, you can send cryptocurrency funds to an address of choice. If there are fiat currencies in the account, those can be transferred to a verified bank account. This means in most accounts closed due to User Agreement infringement, Coinbase will not prevent access to funds.
In some rare cases, however, this exchange will freeze assets, and this is done only when required by law, so hopefully, it will never happen to you. In such a case, your paper wallet and multisig vault will remain untouched as private keys are not accessible for Coinbase.
After reading this article, you will learn all the things that make your account be at risk of facing restrictions. Keep in mind, internal workings of companies like Coinbase remain largely undisclosed, and mistakes can be made. Therefore, the risk of your account triggering a false positive or having security compromised will always exist.
Why Can Coinbase Suspect Your Account Is Infringing Terms?
If you use Coinbase to operate with large volumes, we highly recommend you consider reading its user agreement. It would help if you read it regardless of your trading volume, and this is always a recommended practice.
Any inconsistency found in your account by the platform is likely to have your account marked as suspicious. Keep in mind that this is not a whim on the company’s part but rather a necessity to comply with regulations.
Businesses handling this kind of asset volume have to take extra measures to know what accounts are being used. This kind of business can sometimes be used to launder money, fund terrorism, or other inadequate endeavors.
First and foremost, you have to be at least 18 years old to use the platform. It is also mandatory for you to operate for yourself and not on behalf of third parties unless clearly stated.
When providing Coinbase with information, you have to pledge to give accurate data and update it if needed. In general, you have to avoid using the platform in ways that the company didn’t intend.
For example, attempting to use your account to trade in unsupported currencies is likely to be penalized somehow. Using automated software to handle your account can also be a reason for suspicion on Coinbase’s part.
You also have to consider Coinbase account restricted issues that may be caused when account security is compromised. A good way to prevent this is by following all the usual security guidelines.
Use a strong password and secure your email, which is considered a very important way to connect with Coinbase. Make sure your devices are updated and clean whenever possible, as malware can compromise your online accounts.
Using the most secure 2-step verification methods is also a good idea. Security keys are probably the best in this category, but Time-based One Time Password (TOTP) methods are very good too. For more information on keeping your account secure, visit Coinbase’s recommendations on this topic.
How Can You Contact Coinbase Support?
If you know you haven’t been using your account in ways that could have it canceled, you should contact support. Avoid contacting Coinbase through methods not listed on its site, as those could be set up by parties unrelated to the company.
If you are contacted by someone claiming to be Coinbase support, be careful not to disclose passwords or recovery methods. These instructions may sound like too much but can save you from hassles and loss of funds.
After doing a quick Google search, you will probably find a support phone number for Coinbase. However, its phone support is not intended for cases where accounts are restricted.
You should only call those numbers in case you have to lock your account or need support for the Coinbase Card. Locking your account is advised if you see suspicious activity in your account and think it may be compromised.
The recommended way to contact Coinbase is through Email support. You have to complete an online form selecting the type of issue you are facing. Make sure to explain your situation well in the last text box, so the support team can get to work immediately.
Filling a form may leave you feeling like you should do more to recover control of your funds.
However, contacting Coinbase through other means is not likely to help. Resist the urge to keep sending support tickets through the form, as that will not speed up the process either. It may take a while for support to answer, so there’s not much to do but be patient.
What Can You Do To Solve a Coinbase Account Restricted Problem?
First of all, if your Coinbase account is restricted, you may want to try moving your funds elsewhere. Sometimes this is an option and will allow you to keep working with your assets.
Sometimes these problems are not because of particular accounts being targeted, and it may be that it’s just a matter of waiting for it to be solved. If you face a Coinbase account restricted problem, check that the company hasn’t contacted you by email.
It may also be a good idea to look at what Coinbase’s status page shows. There, you can see if there are ongoing large-scale issues.
If the site seems to be working alright, you should search for other problems in your account. Check that your personal information is correct and ensure your account doesn’t infringe on terms and conditions.
It would help if you also learned what financial regulations apply to Coinbase in your area. Especially in the US, the exchange has to comply with many different entities, and this may take time and result in Coinbase accounts being restricted for different reasons.
Then you should fill a support ticket on the platform, providing enough detailed information. Consider that ticket updates from support can take two weeks or more.
Those agencies that regulate Coinbase can be contacted if you don’t get a response from the company in a couple of weeks. One important agency which can be contacted for help is the Consumer Financial Protection Bureau, and this agency was created for this very reason, to help Financial Services users.
What Else Can Be Done to Secure Your Account
It is always a good idea to take extra steps to make your account secure. Using 2-step verification is highly recommended, as it is one of the most effective ways to secure authentication. Using a security key is probably the best-case scenario, but 2FA apps are also very good.
Security keys are devices that have to be used with your username and password to log in. Usually similar to a flash drive in size, these little gadgets make your accounts very hard to break.
2FA apps are software tools that work well to secure accounts and are simple to use. Duo and Google Authenticator are good, and Coinbase supports both of them!
We hope these tips helped you solve your Coinbase account restricted issue, or at least gave you some ideas.
If you contacted Coinbase less than a few weeks ago and they didn’t respond, take it easy. Customer support times can take quite some time when it comes to this type of issue, and this is because there are many checks the customer support teams need to make in the process.
It may be that this exchange’s issues are temporary. However, if you need a cryptocurrency exchange, it may be wiser to go with an alternative. Check out some of our crypto reviews to find out what are the best exchanges around.
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