By Niket Nishant and Pritam Biswas
(Reuters) -Coinbase forecast a hit of $180 million to $400 million from a cyber attack that breached account data of a “small subset” of its customers, the crypto exchange said in a regulatory filing on Thursday.
The company received an email from an unknown threat actor on May 11, claiming to have information about certain customer accounts as well as internal documents.
While some data — including names, addresses and emails — was stolen, the hackers did not get access to login credentials or passwords, Coinbase said. It will, however, reimburse customers who were tricked into sending funds to the attackers.
Hackers had paid multiple contractors and employees working in support roles outside the U.S. to collect information. The company has fired those involved, it said.
Separately, the New York Times reported that the U.S. Securities and Exchange Commission was investigating if the company had misstated its user numbers.
Coinbase shares extended losses after the report and were last down 6.5%.
“This is a hold-over investigation from the prior administration about a metric we stopped reporting two and a half years ago, which was fully disclosed to the public,” Coinbase’s chief legal officer, Paul Grewal, said.
“While we strongly believe this investigation should not continue, we remain committed to working with the SEC to bring this matter to a close.”
The SEC declined to comment.
CRACKS IN CRYPTO
The latest developments come days before the company is set to join the benchmark S&P 500 index, casting a shadow over what was expected to be a landmark moment for the crypto industry.
Security remains a challenge for the crypto industry despite its growing mainstream acceptance. In February, Bybit disclosed a hack in which around $1.5 billion of digital tokens were stolen — widely dubbed the biggest crypto heist of all time.
“The cyber attack may push the industry to adopt stricter employee vetting and introduce some reputational risks,” said Bo Pei, analyst at U.S. Tiger Securities.
Funds stolen by hacking crypto platforms totaled $2.2 billion in 2024, according to a report from Chainalysis.
“As our nascent industry grows rapidly, it draws the eye of bad actors, who are becoming increasingly sophisticated in the scope of their attacks,” said Nick Jones, founder of crypto firm Zumo.
Coinbase has refused to pay a ransom demand of $20 million from the attackers and is working with law enforcement agencies. It has instead established a $20 million reward for information on the hackers.
The company is also opening a new support hub in the U.S. and taking other measures to prevent such cyberattacks, it said.
(Reporting by Niket Nishant and Pritam Biswas in Bengaluru; Additional reporting by Prakhar Srivastava, Hannah Lang and Pete Schroeder; Editing by Shinjini Ganguli and Alan Barona)
