In May 2025, an explosive news story shocked the entire cryptocurrency industry: the largest U.S. crypto exchange, Coinbase, suffered a serious security incident, with over 97,000 user information stolen. The company has formally submitted a data breach statement to the court.
Although user assets were not directly stolen, the impact of this incident far exceeds the surface. We conducted in-depth research on the breach, Coinbase's response, and market reactions, providing users with necessary security guidelines.
1. Incident Review: The leak originated from an internal support agent, with stolen information involving 97,000 users.
According to official confirmation:
The vulnerability stemmed from improper operations by a third-party outsourced customer service agent.
The attacker obtained usernames, emails, and some phone numbers.
Passwords, wallet private keys, or assets were not directly accessed.
Although assets were not lost, such information is enough to trigger large-scale phishing attacks, identity fraud, and social engineering attacks, posing significant risks to users.
2. Coinbase refuses to pay the $20 million Bitcoin ransom and instead offers a reward for catching the criminals.
CEO Brian Armstrong took a hard stance:
Refused to pay the $20 million BTC ransom demanded by hackers.
Publicly offered a reward of the same amount to encourage tips on the hackers.
While this move demonstrates determination, it also sparked dual controversies in legal and security aspects.
This public confrontation is not just a technical showdown, but also a test of the trust system in the crypto industry.
3. The market reacted sharply, with Coinbase's stock price plummeting over 7% within 48 hours.
After the incident broke out:
Coinbase's stock price quickly fell by 7.1%, marking the largest quarterly decline.
The original plan to include in the S&P 500 index was forced to be shelved.
The legal team faces numerous lawsuits, with users accusing the company of long-term security negligence.
Coinbase estimates that this breach will result in direct and indirect costs between $180 million and $400 million, including legal, compensation, technical fortification, and reputation restoration.
4. Core Warning: Centralized platforms are not vaults; users need to build their own defenses.
Although Coinbase is one of the most regulated exchanges, this incident again confirms an iron rule:
In the crypto world, security responsibility ultimately lies with the users themselves.
It is recommended that every user immediately review their security measures:
✅ Cold wallet storage for assets.
Use hardware wallets like Ledger, Trezor, or SafePal to keep assets offline and defend against exchange and phishing attacks.
✅ Dedicated email + privacy protection.
Use separate emails for all crypto-related accounts (recommended privacy platforms like ProtonMail) to avoid being linked by social networks.
✅ Non-SMS two-factor authentication (2FA).
Switch to Google Authenticator, Aegis, or Authy for 2FA to avoid SIM card hijacking.
✅ Strong passwords + password manager.
Use Bitwarden or 1Password to manage strong passwords and avoid using the same password across the web.
✅ Withdrawal whitelist mechanism.
Enable withdrawal whitelists to prevent unauthorized addresses from being able to transfer out even if the account is compromised.
✅ Real-time monitoring of data breaches.
Use HaveIBeenPwned.com or Firefox Monitor to check if your email/phone number appears in leaked databases.
✅ Review wallet authorizations.
Regularly use tools like Revoke.cash to clear redundant contract authorizations and prevent dApp backdoor attacks.
✅ Use temporary wallets for high-risk activities.
When minting NFTs or experimenting with new protocols, use a 'Burner Wallet' for isolation.
5. Conclusion:
The Coinbase incident is a wake-up call for the industry and an opportunity for user awakening.
This data breach at Coinbase is not an isolated incident; it reflects the industry's long-term neglect of user data boundaries and security education.
This crisis also made more people realize that:
Decentralization is not just a technical choice, but also a choice of responsibility.
For the platform, this is a stress test of trust crisis.
For users, this is an opportunity to rebuild the digital security system.
In the future, whether to trust centralized exchanges is no longer important. What really matters is whether you have started building your own firewall and digital survival capabilities.
