Contents
Coinbase is a digital currency exchange headquartered in San Francisco, California. They broker exchanges of Bitcoin, Ethereum, Litecoin with fiat currencies in around 32 countries.
Checkout this video:
Introduction
Is your crypto safe on Coinbase? The short answer is: probably. The long answer is a little more complicated.
Coinbase is one of the most popular cryptocurrency exchanges, and for good reason. It’s user-friendly, reliable, and boasts a host of security features. But nothing is ever 100% secure, and there have been a few high-profile security breaches of Coinbase in the past.
In this article, we’ll take a look at Coinbase’s security features and history, as well as what you can do to keep your crypto safe if you choose to use Coinbase.
What is Coinbase?
Coinbase is a digital asset exchange company headquartered in San Francisco, California. They broker exchanges of Bitcoin, Ethereum, Litecoin and other digital assets with fiat currencies in 32 countries, and bitcoin transactions and storage in 190 countries worldwide.
How Coinbase Stores Your Data
Coinbase stores 98% of customer funds offline in “air-gapped” cold storage. Only 2% of customer funds are stored online in “hot wallets” to allow for transfers. The remaining customer funds are stored in “vaults” which require 48 hours to process a withdrawal. If you’re looking for an exchange that places an emphasis on security, Coinbase is a good choice.
The Coinbase Security Model
The Coinbase security model is based on the principle of security through obscurity. That is, the inner workings of the system are not publicly known and therefore cannot be easily exploited by would-be attackers. In addition, Coinbase employs a number of security measures to further protect user data, including two-factor authentication, encryption, and regular backups.
The Coinbase Security Process
Coinbase has built itself into one of the most reliable, secure places to buy and store your cryptocurrency. But how exactly does Coinbase protect your digital assets?
Here’s a look at the Coinbase security process:
1. Cryptocurrency is stored in offline wallets.
2. 2-Factor Authentication is used for all login attempts.
3. Email alerts are sent for all account activity.
4. 95% of customer funds are stored offline in cold storage.
5. RSA Encryption is used for all data in transit.
6. Cryptocurrency is insured against hacks and theft.
7. Institutional investors have invested over $500 million in Coinbase.
What Happens if Coinbase is Hacked?
If Coinbase were to be hacked, it would likely mean the loss of customer funds. While Coinbase maintains a high level of security, it is not immune to attack. In the event of a hack, Coinbase would likely utilize its insurance policy to cover any losses. This would mean that customers would not necessarily lose all of their funds, but there could be significant delays in accessing them.
How to Keep Your Coinbase Account Safe
Coinbase is one of the most popular cryptocurrency exchanges, but that doesn’t mean it’s immune to hacks. In fact, Coinbase has been hacked before, and although no customer accounts were compromised, it’s still important to take steps to keep your account safe.
Here are some tips for keeping your Coinbase account safe:
-Enable two-factor authentication (2FA). This is an important security measure that adds an extra layer of protection to your account. With 2FA enabled, you’ll need to enter a code from your phone or another device in addition to your password when logging into your Coinbase account.
-Don’t use the same password on Coinbase as you do on other websites. If someone gets ahold of your password, they could access your Coinbase account and any other accounts where you use the same password. Use a unique password for each account, and make sure those passwords are strong (include numbers, symbols, and both upper- and lower-case letters).
-Don’t store large amounts of currency in your Coinbase account. Just like with a traditional bank account, it’s best to keep only what you need in your Coinbase account and store the rest in a more secure location. You can use a hardware wallet like the Trezor or Ledger Nano S for offline storage.
-Be aware of phishing scams. Fraudsters will sometimes send fake emails or create fake websites that look like the real Coinbase in an attempt to get you to enter your login details. Always double-check the URL before entering your login information, and be on the lookout for grammatical errors or other red flags.
Following these tips will help keep your Coinbase account — and your cryptocurrency — safe from hackers and fraudsters.
Conclusion
Coinbase is a digital asset exchange company headquartered in San Francisco, California. They broker exchanges of Bitcoin, Ethereum, Litecoin and other digital assets with fiat currencies in 32 countries, and bitcoin transactions and storage in 190 countries worldwide.
