According to those familiar with the matter, cryptocurrency exchanges Kraken and Binance were also targeted by a similar social engineering hack that the Coinbase exchange recently disclosed. However, the difference was that Binance and Kraken successfully prevented the attacks without losing customer data.
Those familiar with the matter said these two platforms had technologies and policies that protected them against such attacks.
Rising Cyberattacks Follow Market Surges
Cybercriminals have targeted crypto market players and firms since the industry’s early days. Historically, the number of attacks usually rises when cryptocurrencies’ prices go up, which has also happened recently.
Over the past few years, other digital asset platforms like FTX, Bybit, and Bitfinex have lost billions of dollars worth of assets to bad actors. One of those who spoke anonymously revealed that Binance saw that some scammers offered bribes to some of its customer-service agents. However, it assigned a telegram handle to deal with the situation.
Usually, Binance identifies possible bribery situations in multiple languages and stops its discussions using artificial intelligence bots. Some exchanges allow their representatives to check their customers’ background information when they call their customer service department.
There were claims that security personnel at many crypto exchanges notified Coinbase that hackers were targeting some of its top users. Familiar sources stated that one exchange notified Coinbase of the situation several times using Telegram.
Coinbase’s $20M Standoff: Hackers Demand Ransom, CEO Offers Bounty Instead
However, Coinbase has neither denied nor confirmed that it received notifications of the possible threat of a hack. In the Coinbase breach, the attackers wanted a $20 million ransom to delete customer data it obtained from bribing the platform’s customer agents.
The platform’s CEO, Brian Armstrong, stated on social media that the company won’t pay the ransom. Instead, it would pay anyone the same $20 million if they provided information that could lead to the arrest of cybercriminals.
The customer service reps shared details like names, dates of birth, government-issued ID numbers, dates when customers opened their accounts, and the current balances in such accounts. In a post-breach incident, Coinbase said it started to observe unusual activities in some of the reports as early as January 2025.
Hack Exposes Surge in Social Engineering Attacks
There has been a massive increase in social engineering attacks on cryptocurrency exchanges over the past twenty-four months. There have also been cases of hackers obtaining user data illegally when users click on fake crypto platforms’ website links or install fake apps of these crypto platforms.
Using this method, two Binance users in Israel recently reported that they almost transferred their funds to a new wallet controlled by hackers. One of these two said the caller sounded like a British citizen on the phone, a testament to the lengths these hackers are willing to go to achieve their aim.
Coinbase Stock Up 27% In Five Days, Defying Data Breach Concerns
Meanwhile, Coinbase’s stock (COIN) will be listed officially on the S&P 500 on May 19. It would be the first time a crypto-based company would be on this index. After the announcement, COIN’s price rose by over 27% in the last five days and 9% over the previous 24 hours to trade at a current price of $266.
The gain is significant given that the U.S. Securities and Exchange Commission has launched an investigation to determine whether Coinbase wasn’t truthful about its user data in its past filings. This new investigation adds to the previous one by the U.S. regulator on whether some digital assets on the platform are securities.
Before the breach incident, Coinbase acquired derivatives exchange Deribit to expand its services beyond spot trading. The exchange’s Q1 report showed that its revenue was up 24% compared to the same period in 2024, following notable increases in its subscription services and transaction volume.
