Coinbase Faces Lawsuit Over Funds Stolen In Security Breach

Key Points:

• New York resident Jared Ferguson has filed a lawsuit against cryptocurrency exchange Coinbase for the theft of $96,000 in crypto assets.
• Coinbase has faced criticism in the past for its security practices. In 2019, it was revealed that the company had inadvertently stored thousands of users’ passwords in plain text, leaving them vulnerable to hacking attempts.
• Coinbase has yet to issue a public statement on the matter.

New York resident Jared Ferguson has filed a lawsuit against cryptocurrency exchange Coinbase for the theft of $96,000 in crypto assets.

In response to the lawsuit, Coinbase has refused to respond, claiming no responsibility for the breach of security that led to the losses.

According to reports, Ferguson received a text message from his mobile operator in May of this year regarding a request to replace his SIM card, which he did not initiate. He was unaware of the theft from his Coinbase account until he restored iPhone service the following day with a new card. Ferguson claims that Coinbase is liable under state and federal law for the unauthorized withdrawals, but the company declined to compensate him. Coinbase stated that securing passwords and two-factor authentication is the user’s responsibility.

Ferguson argues that Coinbase’s security processes failed to flag and hold back “fraudulent and unauthorized transactions.” He claims that his account was accessed from a new device in under eight hours and from an IP address that had not previously been linked to his account.

The incident has raised concerns about the security measures at COIN, one of the world’s largest cryptocurrency exchanges. With the rise of cryptocurrency theft and hacking attempts, exchanges must maintain high levels of security to protect their users’ assets.

In 2019, it was revealed that the company had inadvertently stored thousands of users’ passwords in plain text, leaving them vulnerable to hacking attempts. The incident prompted Coinbase to implement new security measures, including using hardware security keys for two-factor authentication.

Despite these measures, the recent theft suffered by Jared Ferguson highlights the need for continued vigilance in protecting cryptocurrency assets. With the rise of cyberattacks and other security threats, users must take all necessary precautions to secure their accounts and prevent unauthorized access.

Coinbase has yet to issue a public statement on the matter. However, the outcome of the lawsuit filed by Jared Ferguson may have significant implications for the future of cryptocurrency exchanges and their responsibilities in protecting users’ assets.

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Annie

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