Coinbase (NASDAQ: COIN) has reportedly slashed the “unauthorized-transfer” reimbursement that anchors its Coinbase One subscription, chopping the headline cap to just $10,000 from the long-advertised $1 million.
One of the subscribers, writing on Reddit, said customer support offered “only [to] refund me 1 month of the 12 I’ve paid for, even though they changed insurance protection without any notification.” The user is now urging fellow customers to file complaints with the Federal Trade Commission, state attorneys-general and the Better Business Bureau, arguing the move amounts to “blatantly bait & switching loyal customers.”
The timing compounds Coinbase’s reputational risk. On June 4, leaked internal correspondence revealed the exchange knew months earlier about a support-staff breach that exposed data on roughly 70,000 customers yet delayed its SEC disclosure until mid-May. The same episode featured teenage hackers joking about funding CEO Brian Armstrong’s “hair transplant” with blackmail proceeds.
Analytically, the downgrade shifts far more risk back to users while shaving an undetermined—but certainly material—liability off Coinbase’s own balance sheet. That may appeal to investors eyeing cost containment ahead of a potential windfall from partner Circle’s supersized IPO, but it collides head-on with regulators already probing the firm’s consumer-protection record.
Coinbase has logged over 8,000 complaints with the Consumer Financial Protection Bureau and is battling a lawsuit from the Oregon attorney general.
Information for this briefing was found via CoinGeek and the sources mentioned. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
