Throughout the morning of Sunday, October 2, 2022, Coinbase users noticed a malfunction in the cryptocurrency trading platform. A malfunction that lasted about 6 hours, leaving customers in doubt. Indeed, during this period, Coinbase users could not withdraw funds to their bank accounts.
The reasons for this sudden interruption
Last Sunday morning, one of the most major cryptocurrency trading platforms namely Coinbase was almost inaccessible.
Indeed, during this period of inactivity of which no one had been informed, users could no longer transfer funds from the platform to their bank accounts.
This inability to perform a transaction to withdraw funds has particularly affected users who have bank accounts in the territory of the United States of America. According to Coinabse, the outage is due to an issue with the Automated Clearing House Network.
Indeed, it is an electronic system that facilitates online banking transfers in the United States. This system is also used by the platform for transfers between bank accounts in the country.
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Very quickly, the problem was identified by the Coinbase technical team and was resolved. Transactions to customers’ bank accounts were able to resume at midday.
However, it should be noted that this failure did not put the entire platform out of service. So during the outage, users could still make purchases of digital assets using debit cards and PayPal accounts as payment methods.
Are user funds adequately protected?
Coinbase is a crypto exchange with over 103 million users around the world. It is also one of the first American exchanges specializing in cryptocurrency exchanges with trading volumes of around 966 million dollars daily.
Although the number of users of this platform is known, the number of users who hold a US bank account is not known exactly.
However, crypto exchange Coinbase was keen to reassure all of its users that their e-currency holdings were still safe despite the outage.
While everything is back to normal and user funds were not affected by the outage, Coinbase is experiencing a lot of issues right now. Moreover, last Thursday, the market sanctioned the company by lowering its share price, which fell by 9%.
This share price plunge came after Wells Fargo issued a serious warning about the platform’s profitability.
Moreover, according to a note written by Jeff Cantrell, Amid Patel and Griffin MacMaster who are financial analysts, Coinbase is under pressure.
This, because of strong competition from FTX US and the Binance crypto exchange. Also according to these analysts, these two competitors have already recovered a significant share of the Coinbase market.