[mastermojo]

This kinda sucks for all parties involved.

1. Funds from an individual Coinbase account are transferred off of Coinbase onto another Bitcoin wallet.

2. The owner of the Coinbase account claims they were hacked.

Obviously I like the idea of Coinbase making account holders whole, but that creates a moral hazard and also incentivizes account holders to commit fraud themselves. What if I give my friend my credentials and he drains my account? On the other hand if I lost money on Coinbase I would be complaining all the way until I got my money back.

There are controls that can minimize damages but sacrifice usability (make withdrawals whitelist only etc). I think they have a "Vault" product that has multi-sig and time-delay options for users.

Reminder to use hardware multi-factor (like yubikey) if you own a lot of cryptocurrency on an exchange. An authenticator app is the next best option.

[freewilly1040]

Dealing with fraud is a very large part of holding money on other people's behalf, and the suggestion that this wouldn't be Coinbase's problem to detect and mitigate speaks to the ridiculousness of crypto.