Coinbase Attack Takes Shine Off Exchange Enthusiasm

Bitcoin prices lost roughly 6 percent on Wednesday, February 4, as worries about the currency’s security resurfaced. The

was trading near $225 on Thursday morning as investors’ enthusiasm about Coinbase’s recently unveiled regulated exchange was replaced by skepticism amid security breach reports.

At the

, Coinbase made history by rolling out the U.S.’s first regulated bitcoin exchange in several states. The company promised to make buying and selling the cryptocurrency safe and easy for the general public, and was touted a major success in bringing

of a phishing attack that compromised its customers’ bitcoin wallets. Some of the exchange’s users received an email that prompted them to log into their accounts, which allowed another application to remove bitcoins from their account.

Coinbase has said the attack was carried out on a relatively small scale and that the company is working to contact all users who were involved. Additionally, Coinbase has promised to refund affected customers and will roll out new tools to help its customers protect themselves from future attacks.

It is unclear whether or not Coinbase will be paying out-of-pocket for this incident; the company has been insured against hacking and theft, but the attack could be considered user negligence.

It remains to be seen whether Coinbase’s swift handling of the problem will be enough to maintain customers’ trust and keep them from backing away from using bitcoin, as well as the company’s exchange.