Coinbase Users Voice Frustrations Over Unexpected Account Restrictions and Blocks Amidst $65 Million Stolen in Social Engineering Scams

In recent months, a growing number of users on social media platform X (formerly Twitter) have voiced their frustrations regarding unexpected account restrictions and

Coinbase users have taken to social media to express their frustrations over unexpected account restrictions and blocks imposed by the US-based cryptocurrency exchange.

These complaints come amid rising concerns over social engineering scams, which are estimated to cost customers over $300 million annually.

In recent months, a growing number of users on social media platform X (formerly Twitter) have voiced their frustrations regarding unexpected account restrictions and blocks imposed by the US-based cryptocurrency exchange Coinbase.

This wave of complaints has raised significant concerns about Coinbase’s risk management practices and its effectiveness in preventing users from falling victim to social engineering scams, which are estimated to cost customers over $300 million annually.

Coinbase Accounts Restricted, Users Complain Amid Rising Scam Losses

ZachXBT, a crypto investigator, has attributed these account issues to Coinbase’s “aggressive risk models,” which appear to prioritize security measures at the expense of user accessibility.

Analyzing withdrawals from Coinbase, ZachXBT found that $65 million was stolen from users between December 2024 and January 2025 alone. This figure is likely a fraction of the actual losses.

In one troubling case, an individual reportedly lost around $850,000 to a sophisticated scam. The scammer used a spoofed phone number and personal information from compromised databases to gain the victim’s trust.

Impersonating a Coinbase representative, the scammer claimed that the victim’s account had experienced unauthorized login attempts—a tactic that Coinbase itself explicitly warns users against, noting that they will never initiate phone calls.

Afterward, the scammer sent a counterfeit email that appeared to come from Coinbase, complete with a fake Case ID to further gain the victim’s confidence.

They then instructed the victim to transfer funds to a Coinbase Wallet and whitelist a specific address, all while assuring them that “support” was verifying their account’s security.

Coinbase Faulted For Lackluster Response, Exchange Blames Scammers

Scammers have reportedly developed nearly identical clones of the Coinbase website, enabling them to send phishing emails that appear legitimate. Numerous Telegram channels have emerged, where these scammers advertise their malicious tools.

The responsibility for these security failures lies heavily with Coinbase’s leadership, which has been criticized for not adequately addressing the root causes of these issues.

suggest that these problems stem from a combination of factors, including Coinbase’s aggressive risk models, lack of advanced user options, and inadequate support for victims.

While it is tempting to place blame solely on the exchange, the reality is more nuanced, ZachXBT suggests. Many victims have reported receiving inadequate support from Coinbase, often getting stuck with customer service agents who are unable to provide meaningful assistance.

Moreover, the exchange team is reportedly “frequently difficult to reach” outside of US business hours, which is a significant disadvantage in a 24/7 market, further complicating the landscape for its users.

In light of these challenges, suggestions range from creating account options that enhance security for advanced users to improving outreach and educational resources for those less familiar with the nuances of online security.

Moreover, pursuing legal action against both the scammers and the tools that enable these crimes could serve as a deterrent and demonstrate a commitment to user protection.

Featured image from DALL-E, chart from TradingView.com