Coinbase Trading Vulnerability Exposed By White-Hat Hacker; Service Now Restored

On Friday, an anonymous white-hat hacker named @Tree_of_Alpha managed to suspend trading on cryptocurrency exchange platform Coinbase Global Inc COIN by hacking its advanced trading platform. 

The white-hat hacker tweeted that they found a “potentially market-nuking” exploit and was submitting a HackerOne report. HackerOne runs a bug bounty program for Coinbase. 

Anyone here can get me a direct line with someone at @coinbase , preferably management or dev team, possibly @brian_armstrong himself?

I'm submitting a hacker1 report but I'm afraid this can't wait. Can't say more either, this is potentially market-nuking.

DMs open.

— Tree of Alpha (@Tree_of_Alpha) February 11, 2022

After the initial threat on Twitter, Coinbase announced that “due to technical reasons, Coinbase was disabling trading on its new Advanced Trading platform. While the service would still be accessible, users would be able to cancel existing orders but not place new orders. The Advanced Trading service is available only to a limited audience.”

For technical reasons, we are disabling retail advanced trading. This service will continue to be accessible, but new orders cannot be placed at this time. Existing orders are in cancel only mode.

— Coinbase Support (@CoinbaseSupport) February 11, 2022

Later, the Tree of Alpha posted a follow-up tweet saying, “No actual Coinbase storages (cold or otherwise) are impacted.”

Props where it's due, to the Coinbase team for the speed of reaction on this one, all orders on the new Advanced Trading platform seem paused.

Glad we caught this one before any real harm was done, will do a quick thread once it's fixed. https://t.co/kVsf1ffDH1 pic.twitter.com/Ktl8NoB4Po

— Tree of Alpha (@Tree_of_Alpha) February 11, 2022

Around 11 p.m. UTC, Coinbase announced on Twitter that it had “re-enabled full service for retail advanced trading.”

We’ve re-enabled full service for retail advanced trading. Greatly appreciate the patience and understanding of those retail advanced trading customers using our exciting new platform prior to full-public launch. Customer funds remain safe and were not impacted. https://t.co/tACcyQPMpZ

— Coinbase Support (@CoinbaseSupport) February 11, 2022

Last year, the company reported 7.4 million monthly transacting users, up year-over-year but down from 8.8 million in the second quarter.

Coinbase sees monthly transacting users rising in the fourth quarter compared to the third quarter at a range of 8 million to 8.5 million.

Also Read: 70% Of Shiba Inu Traders On Coinbase Are Now Buying: How Does This Compare To Last Month?