Coinbase was forced to address reports regarding the overcharging users and unauthorized withdrawals from their accounts. It first responded to the controversy by taking to Twitter and starting a thread where it said that it was investigating the issue and has "identified a solution."
Coinbase later releases a more in-depth explanation of the problem in a statement.
Coinbase is a popular cryptocurrency exchange, customers can buy Bitcoin, Ethereum, Litecoin, and Bitcoin Cash on the exchange. Users found that their accounts had been emptied causing anger among its users.
Coinbase detailed the error that caused customers to be overcharged - blaming it on a recent change by credit card companies.
"Card issuers and banks recently requested that the MCC for digital currency purchases be changed by a number of the major credit card networks," Coinbase said in a statement. "As a result, purchases that occurred between January 22nd, 2018 and February 11th, 2018 may have been refunded and reprocessed-resulting in erroneous charges."
During the tweet thread, Coinbase assured its customers that the issue has already been solved and that future purchases would not be affected by the issue. Moreover, the company would be issuing refunds to the customers that have been affected by the change.
Coinbase also urged users to contact the bank or card companies about the charges. It added that it will keep customers informed about any issues.
"Coinbase will ensure that each affected customer will be refunded in full for any erroneous charge," Coinbase said in a statement. "Our processor confirmed that any erroneous charges will be refunded over the next few days; however, if you believe you were affected by this issue or believe you experienced additional, unreimbursed fees or charges, please contact Coinbase's support team at support.coinbase.com so we can address your issue."
Credit Card Companies Take Blame
Coinbase released a joint statement from Visa and Worldpay about the issue. It was emphasized in bold that the issue was not caused by Coinbase.
"Worldpay and Coinbase have been working with Visa and Visa issuing banks to ensure that the duplicate transactions have been reversed and appropriate credits have been posted to cardholder accounts," said a statement from Visa and Worldpay. "All reversal transactions have now been issued, and should appear on customers' credit card and debit card accounts within the next few days."
Both companies also addressed the issue of money being returned to customers in the statement.
"We believe the majority of these reversals have already posted to accounts. If you continue to have problems with your credit or debit card account after this reversal period, including issues relating to card fees or charges, we encourage you to contact your card issuing bank."
Users Are Livid
Users are not happy with the company at the moment. Coinbase's Reddit is currently flooded with complaints about the issue that the company is still trying to solve. One user is threatening to go to the authorities because Coinbase is not taking fault for the overcharges.
Another user claims that the company hasn't completed a wire transfer that has been pending since the end of last year. The thread is full of complaints of other users that are suffering the same issue.
Support staff from Coinbase are responding to threads by directing users to submit a ticket to the Coinbase support.