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Michael Arrington Warns Coinbase Leak Risks User Safety

Michael Arrington Warns Coinbase Leak Risks User Safety

Michael Arrington warns that the Coinbase data leak, exposing user addresses, raises safety concerns amid rising crypto crimes in 2025.

The recent data intrusion at Coinbase, a cryptocurrency exchange, has prompted apprehensions regarding user safety.

Hackers were able to access sensitive information, including home addresses.

On May 15, Cointelegraph reported that Coinbase, the third-largest cryptocurrency exchange in the world, verified that an attack that may result in reimbursement expenses of up to $400 million affected less than 1% of its transacting monthly users.

Nevertheless, Michael Arrington, the founder of TechCrunch and Arrington Capital, suggests that the “human cost” of this data breach may be significantly greater for consumers.

Michael Arrington emphasizes that exposing users’ personal information, such as home addresses, could lead to targeted attacks and harassment, especially as crypto-related crimes continue to rise.

According to Michael Arrington, companies handling sensitive financial data must implement stronger safeguards to prevent such breaches.

Michael Arrington also called on regulators to hold firms accountable when lapses in data security put users at risk.

“I am currently extremely disappointed with Coinbase”, Arrington stated in a May 20 X post that the most cost-effective customer service option has a cost. He also added:

“Something that has to be said though – this hack – which includes home addresses and account balances – will lead to people dying. It probably has already.”

Source: Michael Arrington
Source: Michael Arrington

Cybercriminals reportedly bribed overseas customer service contractors to access internal systems, even though no passwords, private keys, or account funds were exposed.

This enabled them to obtain confidential information that could be employed in physical extortion attempts or social engineering scams.

Crypto wealth has become an increasingly attractive target for criminals, as Bitcoin has recently traded above $100,000. Least address data can potentially expose high-net-worth individuals to real-world risks.

Six violent burglaries that targeted cryptocurrency investors to extort digital assets through kidnapping or torture were reported by Cointelegraph on May 16.

The father of a French crypto entrepreneur was seized in Paris, France, in a ruthless attack on May 4. The victim’s finger was severed by the captors, who then sent a video to his son, requesting 5 million euros in cryptocurrency.

The victim was detained for two days before the French police were able to locate and extricate him.

Five individuals were apprehended in conjunction with the kidnapping, as reported by CNN.

Crypto Exchanges Necessitate “Layered” Cybersecurity

To prevent comparable user data intrusions, crypto exchanges must implement a “layered defense strategy,” as per Ronghui Gu, the co-founder of CertiK Web3, a security firm.

“This may encompass continuous monitoring with behavioral analytics, multifactor authentication across internal systems, zero trust architecture, and privileged access management,” Gu informed Cointelegraph.

“Preventive measures such as regular phishing simulations, tailored security training, and restricting third-party access to sensitive systems may help reduce these risks.”

Nevertheless, Gu cautioned that the threat of social engineering schemes is on the rise, and crypto platforms will need to “rethink their security posture” as assailants “increasingly target human vulnerabilities rather than technical ones.”

Incidents and losses in 2024 by month. Source: CertiK
Incidents and losses in 2024 by month. Source: CertiK

CertiK reported that social engineering schemes, including phishing scams, were the most significant security hazard in 2024, resulting in 296 incidents and a cost of over $1 billion.

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