What the Irish central bank's new penalty means for customers of the cryptocurrency exchange
The Central Bank of Ireland has fined Coinbase Ireland approximately €3.25 million. The fine concerns the protection of customer funds and the oversight of outsourced business processes. Back in 2025, another Coinbase subsidiary had to pay €21.5 million. Rogert & Ulbrich explains what this means for your balance and what your rights are as a customer.
What the Central Bank of Ireland objected to
The Central Bank of Ireland announced a fine of €3.25 million against Coinbase Ireland on October 22, 2026. The penalty is based on a settlement between the authority and the company.
According to the regulator, Coinbase Ireland did not adequately comply with the regulations for the secure custody of customer funds. This stemmed from events in 2023: During the US banking crisis, customers were instructed to deposit money into alternative Coinbase bank accounts. The separate security account for customer funds was not fully covered for extended periods. Furthermore, customer funds were allegedly commingled with funds from other Coinbase companies.
A second allegation concerns outsourcing. The central bank criticized Coinbase Ireland for lacking an adequate control framework for outsourced services and for being too dependent on its US parent company. It also stated that the controls of its own systems had been insufficiently tested.
Coinbase stated that it had identified and reported the problems itself. No customer suffered a financial loss or was prevented from accessing their funds.
Do you have funds on a cryptocurrency exchange and don't know how well they are protected? Let us assess your situation.
Not an isolated case: the penalty from 2025
This is not Coinbase's first sanction in Ireland. In November 2025, the central bank fined Coinbase Europe approximately €21.5 million for deficiencies in monitoring cryptocurrency transactions to combat money laundering and terrorist financing.
According to the regulator, between 2021 and 2025, more than 30 million transactions with a volume of over €176 billion were not properly monitored due to technical errors. This represented approximately 31 percent of all transactions during this period. In the subsequent review, Coinbase reported 2,708 suspicious activities to the authorities.
Together, the two fines amount to approximately €24.7 million. For an internationally operating company, this is financially manageable. However, the repeated complaints demonstrate that European regulators are closely scrutinizing the internal controls of crypto service providers.
Repeated violations are a warning sign. Check where your assets are located and how you can access them in an emergency.
What customer fund protection means for your balance
The penalty addresses a question that many users of cryptocurrency exchanges underestimate: What happens to my money if something goes wrong at the provider?
Payment service providers and e-money institutions must keep customer funds separate from their own assets. This obligation is called safeguarding. In Germany, it is regulated in Section 17 of the Payment Services Supervision Act. It is intended to ensure that customer funds are protected even if the provider gets into difficulties.
The MiCA regulation has applied to crypto assets in the European Union since the end of 2024. Among other things, it obliges crypto service providers to keep their customers' crypto assets separate from their own. This significantly differs from the legal situation before MiCA, when customers often received no compensation in the event of platform bankruptcies.
It is important for you to distinguish between two types of credit:
- Euro balance: Money that you have deposited into your exchange account but have not yet exchanged for crypto assets. This is where the rules for protecting customer funds apply.
- Cryptocurrencies: Bitcoin, Ether, and other coins that the exchange holds in custody for you. Here, the custody obligations under MiCA apply.
- Own wallet: Cryptocurrencies held in your own wallet are independent of the exchange's performance. However, you are responsible for your own login credentials.
Unlike statutory deposit insurance for banks, there is no guarantee for funds held at cryptocurrency exchanges. This makes it all the more important that the segregation of funds actually works. And this is precisely where the Irish regulator identified weaknesses.
Are you unsure how your assets are protected in an emergency? Get advice before a problem arises.
When customers of a cryptocurrency exchange have claims
The fine goes to the regulatory authority, not to the customers. Anyone who has suffered a loss must pursue their claims independently. In practice, we encounter the following situations most frequently:
- Blocked accounts: The stock exchange freezes an account, often citing money laundering investigations, and provides no clear information for weeks.
- Refused payments: Payments are delayed or refused without any plausible reason being given.
- Unauthorized transactions: Unknown individuals gain access to the account and transfer crypto assets to other people's wallets.
- Platform error: Technical malfunctions lead to incorrectly executed orders or losses because functions were unavailable.
Whether and against whom a claim exists depends on the individual case. The basis is initially the contract with the exchange. If the provider breaches its contractual obligations, for example regarding account security or order execution, claims for damages may be considered. In the case of blocked accounts and refused payouts by cryptocurrency exchanges Often, the first step is to request information about the reasons and to set a deadline.
In May 2025, Coinbase itself publicly disclosed an incident in which criminals bribed employees of a service provider and stole customer data. Using this data, fraudsters later impersonated Coinbase. The company announced at the time that it would compensate customers who had fallen victim to such scams.
Is your account blocked or is your withdrawal stuck? Document all communication and have your claims reviewed.
Beware of scammers impersonating Coinbase
Criminals are deliberately exploiting reports about fines and security issues. They impersonate the exchange's customer service and claim that the account is at risk. Their goal is to obtain login credentials or trick customers into transferring their cryptocurrency to a supposedly secure wallet.
Typical warning signs are:
- Unexpected calls: Reputable cryptocurrency exchanges do not usually call customers unsolicited to resolve security issues.
- Pressure and haste: You are told to act immediately because your assets are allegedly at risk.
- Transfer to a new wallet: No one who actually works for the exchange requires you to transfer your coins to a third-party address.
- Questions about codes: Seed phrases, passwords, and two-factor authentication codes should never fall into the hands of strangers.
Anyone who has already transferred crypto assets to fraudsters should act quickly. Transactions can be detected with a Blockchain analysis Often, the trail can be traced, for example, to a stock exchange where the perpetrators hold an account. Funds can potentially be recovered there.
Have you been contacted by people claiming to be employees of a cryptocurrency exchange and lost money? Every hour counts. Get advice immediately.
What Coinbase customers should do now
The current penalty does not mean that your Coinbase balance is at immediate risk. However, it is a good opportunity to review your situation.
- Get an overview: Keep a record of which Euro balances and which crypto assets you hold on which exchange.
- Secure access: Use strong two-factor authentication and a password that you don't use anywhere else.
- Secure documents: Download your bank statements and transaction histories regularly. They are important evidence in case of a dispute.
- Distribute risk: Larger inventories do not need to be permanently stored on a single platform.
- Report any suspicious activity: Report any unknown transactions to the exchange immediately and have the account blocked.
If you have already suffered a loss, save all evidence: screenshots, emails, chat histories, and transaction IDs. Report fraud to the police.
Have you lost money on a cryptocurrency exchange? Don't wait, have your case reviewed to determine what steps you can take now.
Rogert & Ulbrich – Your lawyers for problems with cryptocurrency exchanges
Rogert & Ulbrich represents investors and consumers in banking and capital market law and at Crypto fraud. The partners Dr. Marco Rogert and Tobias Ulbrich have extensive experience with disputes against platforms, payment service providers and banks, including in the case of Problems with Coinbase.
We examine whether you have claims against an exchange or other parties involved, request information about blocked funds, and enforce your rights out of court and in court. In cases of fraud, we collaborate with specialists in transaction tracing.
Is your balance blocked or have you been the victim of fraud? Take contact and secure your claims.
