- Ireland’s central bank has fined Coinbase Ireland €3.25 million for breaching customer fund safeguarding and outsourcing requirements.
- The regulator identified safeguarding shortfalls reaching €5.2 million in 2024, alongside failures to properly separate customer funds from other Coinbase entities.
- Coinbase said the issues have been resolved, no customers lost money and the company has strengthened its internal controls.
The Central Bank of Ireland has imposed a €3.25 million fine on Coinbase Ireland for violations involving customer fund protection and outsourcing oversight.
The regulator announced the enforcement action on Oct. 22, citing breaches of the Electronic Money Regulations.
Coinbase Ireland admitted the violations on Oct. 21 and accepted a formal reprimand alongside the financial penalty.
The original fine of €4.65 million was reduced by 30% under a settlement agreement. However, the sanctions still require confirmation from Ireland’s High Court before taking effect.
Coinbase Customer Fund Shortfalls Reached €5.2 Million
The central bank identified several failures in how Coinbase Ireland managed and protected customer funds.
According to the regulator, daily safeguarding shortfalls reached as much as €5.2 million during 2024.
The investigation found that customer money was sometimes held in accounts belonging to other Coinbase entities rather than being properly segregated under Coinbase Ireland.
Between March 2023 and October 2024, approximately 30 institutional customers deposited U.S. dollars into bank accounts held by Coinbase Inc.
Funds belonging to certain customers transferred from Coinbase UK were also deposited into the UK entity’s safeguarding account until August 2025.
The regulator said Coinbase Ireland lacked adequate internal controls to accurately calculate its daily safeguarding obligations.
These failures could have made it more difficult for customers to recover their money if the Irish subsidiary had become insolvent.
Central Bank Identifies Outsourcing Failures
The investigation also found weaknesses in Coinbase Ireland’s oversight of outsourced operations.
The company relied heavily on infrastructure provided by its U.S. parent organization without maintaining sufficient local expertise to supervise certain safeguarding activities.
Ireland’s central bank had previously raised concerns about the company’s governance arrangements in July 2022 and March 2023.
However, the regulator said those concerns were not adequately addressed.
Coinbase Ireland subsequently appointed a dedicated safeguarding officer in December 2024.
The company also corrected an identified safeguarding shortfall in June 2024 and implemented a fix for an underlying data issue in October 2024.
Coinbase Says Customer Funds Were Not Lost
Coinbase responded by stating that the identified problems have been fully resolved.
The exchange said no customers lost money or were prevented from accessing their funds as a result of the violations.
Coinbase also noted that it voluntarily reported several issues to the Central Bank of Ireland in January 2024 and has since improved its safeguarding procedures.
The latest enforcement action follows a separate €21.5 million penalty imposed on Coinbase Europe in November 2025.
That case involved failures to monitor more than 30 million transactions, resulting in 2,708 suspicious transaction reports being submitted late.
The latest fine highlights the importance of customer fund segregation and effective oversight as cryptocurrency exchanges expand their regulated operations across Europe.
