Coinbase, with it’s beautiful UI and ways of making the currency for nerds easily accessible by everyday people, has grown in popularity over the years. It has jumped through the legal hoops thrown at them by the US Government and has minimal risk of closing shop one day and stealing everyone’s bitcoins (like Mt Gox did). If you are thinking this is a love letter, it’s not.

Personally, I have made over 30,000 USD worth of transactions (buying and selling), partially as an investment and also buying and selling things, using it to quickly loan money to friends or whatever else. So, obviously I have been a fan… so when I write this about Coinbase being the new PayPal you assume I am going to talk about how this is the payment processor of the future and how everyone should use it.

Not quite, it’s like PayPal because they dominate the market and since they do they feel less of a need to be transparent with their customers and can act in terrible ways (illegal ways in the case of PayPal), and get away with it because they are the best tool on the market. I have had some vague complaints about Coinbase in the past, but kept them to myself until last week when I was informed my account was shut down due to “multiple TOS violations” and that it was not something I can appeal.

Not sure what the problem was with my information, but fine.

It started when I tried to login and I was just looking at the new UI which I haven’t seen because it’s been a few months since I logged in since I had issues with my Two Factor Authentication (2FA). When I got logged in it said my account was locked and I needed to contact support to unlock it. So I did and they told me that my employer of “Self” and my job title of “Owner” was not valid, when I was filling out these fields I was not prompted for what they were looking for and I couldn’t think of a better way to indicate being self employed. I updated my employer with the LLC that I have and changed my job title to “web developer” and thought I was good.

Nope.

I even included a :) I thought we were all done.

Apparently after a careful review of my account there were “one or more violations” of the user agreement. I followed up acknowledging that I couldn’t appeal, but wondering what the TOS violations were. I am especially curious if it’s because of some kind of fraudulent use of my account or something. Nothing. No reply, no information. Basicallly thanks for using our service, we don’t need your business anymore.

Pardon, Je ne parle pas français

Today, at just after midnight… I did get one last email from Coinbase… and it honestly just raised more issues than it addressed. This one was an automated email:

It was sent to my gmail account (my coinbase account is me@travismccrea.com) It was in French. Je ne parle pas français. Is it trying to imply I am in violation of FinCEN laws? Or is that just a part of it’s automated message?

To be clear: They have a copy of my drivers license, my social security number, validation that my SSN is actually mine, and my linked bank account. They know it’s me and I am more validated with coinbase than I am with my actual bank. More than that they wont tell me if they are going to purge my private data from their servers, or any additional information. I am now dead to Coinbase.

Coinbase is becoming the new PayPal, but not in the way we want it to. If you are interested in buying bitcoins, perhaps you should look elsewhere before trusting your information to a company with no transparency.