By Thaler
Coinbase users were thrown into a panic Wednesday after finding that their digital wallets had suddenly appeared to be wiped out – only to find out their funds were safe and that the cryptocurrency exchange platform had suffered a crash.
Coinbase CEO Brian Armstrong tried to calm fears as users flooded social media, blaming the crash on a “large surge in traffic” as Bitcoin blew past $60,000 for the first time in two years.
“I had $3.6 million in Coinbase and now it shows $0,” popular crypto-trading personality Ash Crypto wrote to X with a screenshot of his total balance on the platform, which showed “$0.00.”
“WTF IS HAPPENING?”
Coinbase confirmed the crash in an X post, where it said: “We are aware that some users may see a zero balance across their Coinbase accounts & may experience errors in buying or selling. Our team is investigating this & will provide an update shortly.”
The platform assured users, “Your assets are safe,” and posted an incident report on its website where traders could track the status of the outage.
“I can confirm that the user’s wallets were not wiped to $0,” a Coinbase spokeswoman told. “This was a display issue only.”
Armstrong told Bitcoin Magazine that a “large surge of traffic” as users sought to buy, sell or trade Bitcoin on Wednesday – when its price briefly surged to $64,000 – overwhelmed the exchange’s infrastructure.
Roughly two hours later, Coinbase said that it was “beginning to see improvement in customer trading,” but warned that because of persistent increased traffic levels on the platform, “some customers may still see errors in login, sends, receives and with some payment methods.”
“Rest assured your funds are safe,” Coinbase reiterated in its latest update on the incident.
Following the outage, Bitcoin sharply dropped from its $64,000 peak – the first time since November 2021 that the crypto coin broke $60,000 — to about $59,500, wiping out most of the gains the coin experienced on Wednesday and roughly $100 billion from its market cap.
At the time of writing, Bitcoin’s resilient price edged slightly higher, to $61,174.20.
When sought comment from Coinbase, a company spokesperson pointed to its latest update on the crash, which said that trading was slowly improving.
Founded in 2012, Coinbase is the United States’ largest cryptocurrency exchange platform by trading volume.
Aside from Bitcoin – by far the most popular and valuable currency of its kind – Coinbase also gives traders access to other digital currencies on decentralized blockchains, including Ethereum, Colana and Dogecoin, among others.
Just last month, the Securities and Exchange Commission approved the first-ever US-listed exchange traded funds to track Bitcoin – a game-changer for the broader crypto industry, offering institutional and retail investors exposure to the currency without directly holding it.
The securities regulator approved applications, including from BlackRock, Ark Investments, 21Shares, Fidelity, Invesco, and VanEck, among others, according to a notice on its website.
Wednesday’s crash didn’t appear to have any impact on Coinbase’s share price, which rose nearly 2% by the close.
