Coinbase Faces Scrutiny Over Security and Growth Ambitions

Ari Paul, founder of BlockTower, has publicly accused Coinbase of hiding large-scale security breaches that led to his company losing $25 million. In a September 29 X post, Paul claims that repeated hacks occurred over time, and Coinbase failed to disclose them to affected users.

Paul's allegations are based on his own experience with Coinbase but also suggest that at least 12 other companies suffered similar losses, totaling over $1 billion. The exact timing of the alleged breaches is unclear, and Paul has not provided evidence due to ongoing lawsuits.

Separately, Coinbase confirmed a data breach in 2025 tied to bribed customer support staff working overseas. In this incident, hackers stole customer information, which was later used for impersonation scams. However, Coinbase emphasizes that passwords and private keys were not compromised.

The same day as Paul's allegations, Coinbase announced an expanded partnership with Citi focused on stablecoin payments for businesses in the United States. This move aims to integrate traditional banking with blockchain-based payments, making it easier for businesses to transfer funds between systems without manual conversion steps.