A number of Coinbase users have reported unauthorized charges to their bank accounts by the exchange and digital wallet provider, in some cases draining all their funds and leaving customers with large overdraft fees.

Posting on the Coinbase subreddit, customers indicated that previous, legitimate withdrawals from their bank accounts were wrongly duplicated multiple times.

A Reddit post attributed to a Coinbase staff member said the problem was potentially related to the company's recent decision to disable credit cards as a payment option on its platform.

"We can confirm that the unexpected charges are originating from our payment processing network, and are related to charges from previous purchases. To the best of our knowledge, these unexpected charges are not permanent and are in the process of being refunded. We are running joint investigations with all parties involved, and will provide updates as we receive them."

Source: Coindesk

The minimization of traditional credit from the markets

The banking group will be notifying their customer base of the current changes and will be setting up firewalls to prevent purchases of digital assets with credit.

Users of debit will find that they are not constricted, but of course, why would they be? Debit is their money at the end of the day.

Be advised that the banking group is comprised of significant players like Halifax, MBNA and the Bank of Scotland, in addition to Lloyds and this implementation will affect consumers across the board at these institutions.

Coinbase Confirms

This is along the lines of a recent communication sent by the cryptocurrency exchange, Coinbase. The trading firm sent out an email updating its users of change happening in the sector related to credit cards. The trading platform had several reasons to send out the email, but one of the most prominent may be that they want to let their customers know that they are not the ones who are charging more fees. The email notified users of the changes made by financial institutions.


“Recently, the MCC code for digital currency purchases was changed by a number of the major credit card networks. The new code will allow banks and card issuers to charge additional “cash advance” fees. These fees are not charged or collected by Coinbase. These additional fees will show up as a separate line item on your card statement.”

The reasoning of the credit card firms and banks

These firms seem to be echoing lines that the People’s Bank of China and other federal reserves across the world, is saying, such as minimizing financial risks, protecting the consumer from financial harm and more. They profess to save their customers from further debt, debt that they may have to take on if the crypto markets don’t do as well people would hope.

State of the markets

The markets have been in a sea of red and a significant correction period is taking place in cryptoland as the leading cryptocurrencies take actions to live up to their market capitalizations and prove their value over the course of this year. The price of Bitcoin was trading at a rate of $7,425 a large dip from 17,000. The price of Ethereum has gone down to $725.

Source: bitguru.co.uk

DAMAGE CONTROL?

In the face of volatile Bitcoin network fees and competitors already implementing SegWit, which reduces both fees and transaction times, Coinbase has faced increasing pressure from users to follow suit.

A petition in January to force an upgrade as the company’s “top” priority gained over 12,000 signatures.

“Many of our customers have been asking for SegWit, and we’re working out a way to implement this upgrade safely,” Coinbase’s new vice president and general manager Dan Romero wrote in December’s SegWit pledge.


“We store billions of dollars worth of bitcoin on behalf of customers and any change to our infrastructure is done with significant planning and consideration for the security and stability of our platform.”

Coinbase wallet and exchange users continue to face a raft of difficulties as a result of backend technical problems, network health, scandals and external factors.

While developers have sought to reinforce resilience of the exchange’s operations, an unexpected announcement from Visa and MasterCard late last month saw transactions linked to purchasing cryptocurrency accrue significantly higher processing fees.

Coinbase attempted to focus blame on the payments giants, but announcements on social media saw customers chide the exchange.

Bitcoin, in the eyes of a popular Reddit response, was now being treated as “an asset for tax but currency for cash advance fees.”

Source: Bitcoinist