Coinbase has been described as “hemorrhaging money” this week after data showed it had been paying double transaction fees.Fees Glitch Adds To Coinbase Woes
The overspending, likely due to a software problem, is the latest in a series of technical mishaps for the exchange and wallet provider. BitGo engineer Jameson Lopp originally raised the alarm Friday noting “something weird” was occurring on the Bitcoin network, tweeting:12 hours ago an entity began sending BTC transactions paying 100X the going fee rate.
After others agreed, Lopp subsequently announced his suspicions were “confirmed firsthand” and that the party contributing huge batches of double-rate fee transactions was Coinbase.I've just confirmed firsthand: the entity overpaying fees by 100X is @coinbase. You're hemorrhaging money, folks. https://t.co/wTYFOWuxLa — Jameson Lopp (@lopp) July 15, 2017
Responding to the news, CEO Brian Armstrong told Lopp the company was “taking a look” into the situation.Months Of Technical Headaches
In both May and June, Coinbase had suffered technical issues elsewhere on its service, with sporadic problems continuing into this month.
A high influx of new users contributed to an overly-strained backend, with Bitcoin’s recent price peaks and troughs accompanied by website outages, failed or ‘lost’ trades and lack of response from customer support channels.
Users often recounted their woes on social media platforms such as Reddit in the hope of getting attention, with support staff sporadically replying to more serious issues such as hundreds of thousands of dollars going missing.
Also detecting something was amiss in recent days meanwhile was entrepreneur turned commentator Tuur Demeester, who put the amount spent unnecessarily by Coinbase in 24 hours at $240,000.Looks like @coinbase has paid about $240k in unnecessary Bitcoin fees since yesterd...