- Coinbase users in eastern Europe exploited a pricing bug that allowed them to cash out their crypto for 100 times the exchange rate.
- Georgia’s national currency GEL was priced at $290, instead of $2.90 due to a third-party technical issue on Coinbase.
- Coinbase is working on retrieving the improperly withdrawn funds, the exchange’s tokenized stock COIN nosedived.
Coinbase users from the Eastern European country of Georgia exploited a bug in the exchange’s app, withdrawing 100 times the exchange rate. Due to a technical error by a third-party, Coinbase suffered improper withdrawal of funds.
Coinbase’s mispricing results in improper withdrawal of funds
Coinbase users in Georgia reportedly exploited a bug in the exchange, as first reported by Investfox. This allowed users to cash out their holdings for 100 times the exchange rate. Users pocketed thousands of dollars in profit, exploiting the exchange rate bug.
Georgia’s national currency, the Lari (GEL) was mistakenly priced at $290 instead of $2.90. Coinbase told Coindesk that the missed decimal point was a third-party technical issue. Users who reportedly took advantage of the pricing error had their bank accounts and debit cards frozen by banks soon after the transfer.
0.001% of Coinbase’s total users exploited the error, a total of 1,000 customers made transfers to their accounts. Coinbase is yet to disclose the size of its total losses, however a spokesperson considers it a “small non-material amount.” Coinbase fixed the issue and took steps to retrieve the improperly withdrawn funds.
Users who made 100x on their withdrawals to their accounts have lost access to their bank accounts. Therefore it is likely that Coinbase will soon exact the improper withdrawal amount from the users.
LevanIlashvili, a pseudonymous crypto influencer, reported that Georgian bank TBC has blocked accounts of users who took advantage of the pricing error on Coinbase.
@coinbase had a huge issue yesterday and they don't seem to talk about it publicly.— Levan Ilashvili (@LevanIlashvili) August 31, 2022
Yesterday for specific pairs they had quite impressive exchange rates - 1 USDT ~ 290 GEL (exchange rate in local banks 1 USD = 2.86 GEL).
Coinbase’s tokenized stock on FTX, COIN nosedived 6.2% in the last seven days. The token continued its decline post the incident.
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