BlockNews
FOLLOW ON X
  • BITCOIN
  • CRYPTO
    • ETHEREUM
    • RIPPLE XRP
    • SOLANA
    • CARDANO
    • BINANCE BNB
    • DOGECOIN
    • TRON
    • SUI
    • CHAINLINK
    • LITECOIN
  • FINANCE
  • POLITICS
  • MEMECOINS
  • NFT
  • OPINION
No Result
View All Result
BlockNews
  • BITCOIN
  • CRYPTO
    • ETHEREUM
    • RIPPLE XRP
    • SOLANA
    • CARDANO
    • BINANCE BNB
    • DOGECOIN
    • TRON
    • SUI
    • CHAINLINK
    • LITECOIN
  • FINANCE
  • POLITICS
  • MEMECOINS
  • NFT
  • OPINION
No Result
View All Result
BlockNews
Home BUSINESS

Coinbase Threatens to Sue Crypto Traders Who Profited From Pricing Glitch

BlockNews Team by BlockNews Team
October 19, 2022
in BUSINESS, CRYPTO, MEDIA
Reading Time: 4 mins read
1
SHARES
12
VIEWS
Share on XShare in TelegramShare on Reddit

Coinbase is the world’s second-largest cryptocurrency trading platform. The exchange gave hints that it might sue about 1,000 users in the Republic of Georgia for exploiting price discrepancies.

https://twitter.com/UnidefTimes/status/1582321428845965312?t=Q856LGYqyxQ7WWYhEKegCg&s=19
Via @UnidefTimes – Twitter

On August 29, approximately 1,000 Coinbase users in a country sandwiched between Europe and Asia reportedly received a complaint when their local currency, the lari, was trading at $290 instead of $2.90 on Coinbase for about six hours. 

Many users took advantage of the “arbitrage opportunity,” which is about 0.001% of the company’s US-based users.

“The glitch was a “third-party” error,” Coinbase told CoinDesk at the time without specifying the company. 

As such, the case demonstrates a long-standing concern of financial regulators. The institutional risk from external partnerships is eminent in the glitch.

“When everything happens within the bank, we know exactly who is to blame if something goes wrong,” US Attorney General Michael Shu said last week. 

However, the risk can be eliminated by dividing the work between institutional investors and fintech startups with different business models.

A spokesperson said the amount lost in Georgia, which the company refused to disclose, was insignificant.

“Coinbase is working with law firm Gvinadze & Partners to help recover fraudulently deposited funds. “This is according to a Coinbase spokesperson.

“We cannot comment on specific claims or litigation status,” a company representative said. “However, users who return wrongly credited funds will not be subject to further legal proceedings.”

Coinbase Glitch Millionaires Receive “The Email” after a Happy Interview 

Avtandil Kutchava, the host of Georgia’s Crypto Bazari TV show, told CoinDesk that about 470 people had contacted his team about the situation. People may have made millions of dollars in transactions at the wrong Lali rate. On that day, his ATM in Tbilisi’s capital ran out of banknotes.

CoinDesk spoke with four traders who took advantage of this price gap in a group video call. All said they temporarily froze their bank accounts after selling their cryptocurrencies for lari and withdrawing fiat into their bank accounts. A few days later, the account and bank card were unblocked without doing anything.

On September 24, all four received an email from Gvinadze & Partners stating that “Coinbase intends to use all available legal means to recover the funds that were mistakenly deposited as soon as possible. I promise, and if the user does not respond to this email, return the money, and legal action may be taken against them.” 

Coinbase Neither Denies Nor Confirms

Coinbase did not confirm whether the exchange had contacted Georgia banks to freeze traders’ accounts. Traders said at least two of Georgia’s largest banks, Bank of Georgia and TBC, have frozen but unblocked the account of the user who exploited this flaw.

One of CoinDesk’s users (who was asked not to disclose his last name), speaking to a Georgia tech startup manager and amateur trader named Tornike, said he was in Grigoleti, a small resort town, on August 29.

“I sold my Stellar Lumens (XLM) while vacationing on the Black Sea coast.”

He quickly transferred the winnings to his Georgia Bank account and went to a nearby ATM to double-check. Money could be withdrawn. But hours later, Tornike tried to buy wine at a local store. He said the payment went wrong, and his debit card was frozen. Three days later, something changed, and Tornike could use his bank account again.

News site Blockworks cited a text message one of the traders received from the bank. “Hello, we have flagged your transaction with Coinbase as suspicious. We suspend all accounts and cards,” read a blanket SMS message from one bank to a customer. 

Disclaimer: BlockNews provides independent reporting on crypto, blockchain, and digital finance. All content is for informational purposes only and does not constitute financial advice. Readers should do their own research before making investment decisions. Some articles may use AI tools to assist in drafting, but every piece is reviewed and edited by our editorial team of experienced crypto writers and analysts before publication.
Tags: BusinessCoinbasecrypto
TweetShareShare
BlockNews Team

BlockNews Team

DON'T MISS THESE! HOT OFF THE PRESS

Hyperliquid Smashes Records with $106M Revenue in August
CRYPTO

Hyperliquid Smashes Records with $106M Revenue in August

September 2, 2025
HBAR Bulls Show Signs of Life but Key Test Still Ahead
CRYPTO

HBAR Bulls Show Signs of Life but Key Test Still Ahead

September 2, 2025
Stellar Nears Make-or-Break Support as Bulls Eye Next Move
CRYPTO

Stellar Nears Make-or-Break Support as Bulls Eye Next Move

September 2, 2025
Avalanche Balances on Key Levels as ETF Hopes Fuel Speculation
CRYPTO

Avalanche Balances on Key Levels as ETF Hopes Fuel Speculation

September 2, 2025
SUI Balances on $3.20 Support as Traders Watch the Wedge
CRYPTO

SUI Balances on $3.20 Support as Traders Watch the Wedge

September 2, 2025
Chainlink Gears Up for a Breakout as Bulls Eye Key Resistance
CHAINLINK

Chainlink Gears Up for a Breakout as Bulls Eye Key Resistance

September 2, 2025
Load More

Related News

Hyperliquid Smashes Records with $106M Revenue in August

Hyperliquid Smashes Records with $106M Revenue in August

September 2, 2025
HBAR Bulls Show Signs of Life but Key Test Still Ahead

HBAR Bulls Show Signs of Life but Key Test Still Ahead

September 2, 2025
Stellar Nears Make-or-Break Support as Bulls Eye Next Move

Stellar Nears Make-or-Break Support as Bulls Eye Next Move

September 2, 2025
Avalanche Balances on Key Levels as ETF Hopes Fuel Speculation

Avalanche Balances on Key Levels as ETF Hopes Fuel Speculation

September 2, 2025
SUI Balances on $3.20 Support as Traders Watch the Wedge

SUI Balances on $3.20 Support as Traders Watch the Wedge

September 2, 2025
Twitter Telegram Threads

BLOCKNEWS.COM

BlockNews is your premier source for real-time cryptocurrency, blockchain, political and financial market news.

Stay ahead of the herd with BlockNews

RESOURCES

  • About Us
  • Contact Us
  • Editorial Policies
  • Terms and Conditions
  • Privacy Policy
  • Sitemap

DISCLOSURES AND POLICIES

BlockNews provides independent reporting on crypto, blockchain, and digital finance. Content is for informational purposes only and does not constitute financial advice. Sponsored material is always disclosed. By using this site, you agree to our Terms and Conditions and Privacy Policy.

© 2025 BlockNews

No Result
View All Result
  • HOME
  • BITCOIN
  • CRYPTO
    • ETHEREUM
    • RIPPLE XRP
    • SOLANA
    • CARDANO
    • BINANCE BNB
    • DOGECOIN
    • TRON
    • LITECOIN
    • CHAINLINK
    • SUI
  • MEMECOINS
  • POLITICS
  • FINANCE
  • NFT
  • DEFI
  • GUIDES

© 2025 BlockNews