Coinbase hit by breach and SEC probe ahead of S&P 500 entry

Cryptocurrency exchange Coinbase has disclosed a potential financial impact of $180 million to $400 million following a cyberattack that compromised customer data, according to a regulatory filing on Thursday.

The company said it received an email from an unidentified threat actor on Sunday, claiming to possess internal documents and account data for a limited number of customers.

Although hackers gained access to personal information such as names, addresses, and email addresses, Coinbase confirmed that no login credentials or passwords were compromised.

Coinbase stated it would reimburse users who were deceived into transferring funds to the attackers. It also revealed that multiple contractors and support staff outside the US had provided information to the hackers. Those involved have been terminated, the company said.

In parallel, the US Securities and Exchange Commission ( SEC ) is reportedly investigating whether Coinbase previously misrepresented its verified user figures.

Two sources familiar with the matter told Reuters that the SEC inquiry is ongoing, though it does not focus on know-your-customer (KYC) compliance or Bank Secrecy Act obligations. Coinbase has denied any such investigation into its compliance practices.

The SEC declined to comment. Coinbase’s chief legal officer, Paul Grewal, characterised the probe as a continuation of a past investigation into a user metric the company stopped reporting over two years ago. He said Coinbase is cooperating with the SEC but believes the inquiry should be closed.

The news comes ahead of Coinbase’s upcoming addition to the S&P 500 index, potentially overshadowing what had been viewed as a major milestone for the industry. Shares fell 7.2% following the disclosure.

Coinbase has rejected a $20 million ransom demand from the attackers and is cooperating with law enforcement. It has also offered a $20 million reward for information leading to the identification of the hackers.

The firm is opening a new US-based support hub and taking further measures to strengthen its cybersecurity framework.

The cyberattack adds to broader concerns about digital asset platform vulnerabilities. In 2024, hacks have resulted in over $2.2 billion in stolen funds, according to Chainalysis. Bybit alone reported a $1.5 billion theft in February, the largest on record.

Coinbase is also facing a lawsuit filed in the Southern District of New York, alleging the company failed to protect personal data belonging to millions of current and former customers.

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