How Coinbase is protecting customers and the crypto economy

At Coinbase, we believe crypto is a technology that can enhance economic freedom around the world by bringing new opportunities for individuals to take control of their finances. We place a strong emphasis on security and trustworthiness, and have implemented measures to ensure the safety of our customers’ assets and data. These include Know Your Customer (KYC) checks to verify the identity of customers, tools to prevent financial crime and fraud, and measures to protect consumers from hacks and other security breaches. By offering these services, Coinbase aims to establish itself as the most reliable and secure platform for people to buy, sell, and store cryptocurrencies and to participate in the broader crypto community.  

We have leaned into trust and compliance since our founding over a decade ago, and chose to go public in the United States in part because we want America to lead the way in building the next generation of the global financial system. For our mission to succeed, we believe it is important that the United States put in place a regulatory framework that allows innovation to thrive, which is why we are not fighting regulation, but actively seeking to collaborate with the government at all levels to advance forward-looking policies that will empower the next generation of builders and help attract more talent and investment to the US.   

We make crypto safe

Everyone should enjoy economic freedom, and that’s why we’re committed to making it safe for anyone to participate in the crypto economy. Our platform is designed to be user-friendly and accessible regardless of someone’s previous experience with crypto. At the heart of this effort, we’ve always put the security of our customers first. We have done this by making robust investments in state-of-the-art security measures, from multi-factor authentication and extensive KYC checks during onboarding to sophisticated risk management systems to protect our customer’s funds from theft or hacking. We are continually improving our security protocols to ensure that we stay ahead of potential threats, and we invest in providing our users with education and guidance on how to protect themselves. 

We build innovative solutions

While working to give everyone the opportunity to use crypto safely and easily, we also comply with applicable laws and regulations wherever we operate. That’s part of what it means to be the most trusted crypto exchange. For example, just like major banks and other leading global financial services institutions, on a daily basis our compliance and investigations teams work with regulators, including law enforcement agencies, around the world. Our teams proactively educate these same agencies on blockchain forensics and how crypto can leverage the immutability of blockchain to provide more traceability than traditional cash if used for illicit purposes. Our efforts to combat money laundering have been recognized as part of the Law Enforcement Awards Program maintained by the U.S. Treasury’s Financial Crimes Enforcement Network (FinCEN), a program designed to emphasize how our reporting is vital to the successful partnership between financial institutions and law enforcement to the fight against financial crime.

As Coinbase pushes for innovation in our financial system – many parts of which were designed before computers existed with regulations written before the internet was an idea – we seek to work with regulators to develop solutions that keep the space, our customers, and the global financial system safe. 

For example, we led an industry-wide initiative to build TRUST, a technology that allows cryptocurrency exchanges to securely send information legally required by the Travel Rule while protecting the security and privacy of our customers. Until TRUST was established, centralized exchanges like Coinbase had no means of complying with the Travel Rule as on-chain sends don’t carry the same information as the traditional bank payments that the rule was originally designed to cover. Similarly, because of the push-based nature of crypto and near-instant settlement, we’ve built blockchain analytics software to screen and interdict crypto transactions from sanctioned addresses in real time. This process prevents sanctions violations from even happening – something we believe is novel in the industry. 

We put customers first

We have implemented rigorous security measures, adhered to the highest regulatory standards, and educated our users on how to protect themselves. But we’re by no means done. Our efforts to combat fraud and money laundering are not only crucial to the safety and security of our customers, but also to the long-term success of crypto and the broader financial system. By promoting trust and transparency in the industry, we are creating a more secure environment for individuals and institutions to participate in the digital economy, paving the way for its continued growth and success. And that is in everyone’s interest.