What Happens if Coinbase Goes Out of Business? - ChainSec (2024)

FAQs

Are my assets safe on Coinbase? ›

Keep your assets secure

Coinbase Wallet is a self-custody web3 wallet, putting you in full control of the private keys to your assets on the blockchain. Nobody, including Coinbase, can access your tokens or NFTs without your recovery phrase.

Because it is US-based, publicly-traded, and is on the cutting edge of crypto security solutions, Coinbase consistently ranks as the safest crypto exchange in the world. That's why it's trusted by more than 100 million crypto investors.

Coinbase has excellent security measures to ensure its users' funds are safe. However, we recommend moving your crypto assets off any exchange into a self-custodial hardware wallet.

When an account closure happens, buy/sell services are disabled and you will no longer be permitted to use your Coinbase account as a crypto balance. However, access to your balances are not “frozen” as you will be able to send any remaining crypto balances from your Coinbase account to a wallet address of your choice.

Coinbase carries crime insurance that protects a portion of digital assets held across our storage systems against losses from theft, including cybersecurity breaches.

The vast majority of Coinbase client cash is stored in FDIC-insured bank accounts and U.S. government money market funds to keep it safe and liquid.

If you've transferred an unsupported cryptocurrency asset to your Coinbase account, those funds have historically been lost unless Coinbase later adds support for the asset.

Since most people are not specifically trained in computer security, Coinbase can manage the bulk of these security measures on your behalf. At Coinbase, we're committed to security by using industry best practices and storing up to 97% of bitcoins in encrypted, geographically separated, offline storage.

While Coinbase's bankruptcy risk is low and insurance is provided for funds, users don't enjoy the same protection as those putting money in the bank. If an exchange like Coinbase goes bankrupt, the customer assets it holds may be subject to bankruptcy proceedings.

No, Coinbase does not have access to your bank account credentials if you link via Plaid. We will never ask for your bank account username or password.

Can Coinbase freeze your bank account? ›

Using Coinbase generally should not cause your bank account to be frozen.

When you use a linked bank account (ACH) to buy crypto or add cash to your account balance, the funds are placed on hold and won't be immediately available to send or cash out. Think of this like depositing a check to your bank account and having to wait for it to clear before you can remove the funds.

They have implemented various security measures to help protect your funds. When you store your coins on Coinbase, they are held in secure wallets. You can withdraw your coins at any time, allowing you to have control over your investments.

When you buy, receive, or hold digital assets using a Coinbase.com account, they are securely stored or 'custodied' for your benefit in a hosted digital asset wallet. At all times, these assets are yours – they never belong to Coinbase.

Coinbase exchange is a better option if you're looking to buy, sell, and trade cryptocurrencies. Meanwhile, Coinbase Wallet is a better option if you're looking to manage your own private keys and interact with DeFi protocols.

At Coinbase, we prioritize the security of your sensitive information. Here's how we protect your bank account information: Encryption: We store your account numbers and routing numbers using bank-level AES-256 encryption on our servers.