• Jared Ferguson, a Coinbase client, is suing the crypto exchange after suffering a $96,000 loss from a SIM-swap hack.
• The crypto community has expressed mixed reactions concerning the case and some have warned not to trust the security efficiency of SMS 2FA.
• Last month Coinbase fell victim to cyber criminals and customer information leaked to the dark web.
Jared Ferguson Sues Coinbase Over $96k Loss
Jared Ferguson, a Coinbase client from Staten Island, New York, is suing the crypto exchange for refusing to refund him a $96,000 loss incurred when he suffered a SIM-swap hack. Jared contacted Coinbase after the incident but was denied compensation for his lost funds. He has now taken his case to the United States District Court of the Northern District of California in an attempt to receive restitution for his loss.
Crypto Community Reacts To Lawsuit Against Coinbase
The crypto community has responded with mixed reactions following news of Jared’s lawsuit against Coinbase. Some have expressed sympathy for Jared while others stand by the exchange’s decision not to provide reimbursement. There are also warnings that investors should not trust in SMS 2FA as sole protection against hacks and cyber attacks.
Coinbase Suffers Cyber Attack Last Month
Last month Coinbase itself became victim of a cyber attack when customer data leaked onto the dark web. This raises concern that Jared could be among those affected by this breach as it may have allowed hackers access to account details which could then be used against unsuspecting customers like Jared who rely on SMS 2FA authentication as their only form of account security.
Risk Of Leaving Funds On Crypto Exchanges
This case highlights once again how dangerous it can be leaving significant amounts of funds on exchanges without additional forms of protection such as hardware wallets or multi-factor authentication tools other than just SMS 2FA alone. While it is convenient to keep funds on exchanges so that they can easily be used for trading purposes, it also puts them at risk if proper security measures are not taken by users themselves or enforced by exchanges like Coinbase which is why many investors choose instead to store their digital assets offline in cold storage wallets such as Ledger or Trezor devices for added security and peace of mind.
Conclusion
It remains unclear what outcome will arise from this legal battle between Jared and Coinbase but either way it serves as an example of why users need to ensure they take adequate precautions when handling digital assets online and why exchanges must maintain strong security protocols in order protect their clients‘ funds from malicious actors on the internet who seek only to cause financial harm..