$15 000 USD

FEBRUARY 2020

UNITED STATES

COINBASE

DESCRIPTION OF EVENTS

"Coinbase is a secure platform that makes it easy to buy, sell, and store cryptocurrency like Bitcoin, Ethereum, and more." "As the leading mainstream cryptocurrency exchange in the United States, Coinbase has become a standard on-ramp for new crypto investors. Coinbase offers a wide variety of products including cryptocurrency investing, an advanced trading platform, custodial accounts for institutions, a wallet for retail investors, and its own U.S. dollar stable-coin."

 

"Coinbase was founded in 2012 and is a fully regulated and licensed cryptocurrency exchange supporting all U.S. states except Hawaii. Coinbase initially only allowed for Bitcoin trading but quickly began adding cryptocurrencies that fit its decentralized criteria." "Its list expanded to include Ethereum, Litecoin, Bitcoin Cash, XRP, and many others with the promise of more as long as its requirements are met."

 

"The ability to port your SIM card to another device is a service that mobile carriers provide to their customers. It allows a customer to request their phone number be transferred to a new device. In most cases, this is a perfectly legitimate request; this happens when we upgrade to a new phone, switch mobile carriers, etc."

 

"A “SIM port attack”, however, is a malicious port performed by an unauthorized source — the attacker. The attacker ports your SIM card to a phone that they control. The attacker then initiates the password reset flow on your email account. A verification code is sent from your email provider to your phone number — which is intercepted by the attacker, as they now control your SIM card."

 

"My Coinbase Account was broken into by a T-Mobile Sim Swap Attack. There wan unauthorized Sim Swap Done on 2/25."

 

"Accounts Hacked - Coinbase, Gmail, Yahoo, Dropbox" "IP of Attack and Location Reported - Washington, United States. 104.200.129.53"

 

"I had 2FA ... but they knew that my number, email, and coinbase account to hack. The sim swap allowed them into emails and found possible found Goog Auth numbers. Coinbase didn't flag anything such as new device activation, recent password reset, and strange behavior like transferring everything out as suspicious enough to flag." "Had 2FA but they broke into my emails and drop box, did a password reset to coinbase, and possibly found the google auth code while digging through all my stuff. Coinbase also should detect fraud due to a new iP, recent new device, and massive transfer."

 

"In other words you saved your backup codes to your email which was not protected by 2FA. You basically went from having 2FA to single point of failure. Reset email PW via SMS --> Recover 2FA tokens backedup unencrypted in email --> Reset Coinbase password --> BTC gone."

 

"Too be fair, OP did not use SMS 2FA on his coinbase account. He used Google Authenticator TOTP 2FA. What OP did was store his 2FA Back Up tokens unencrypted in his email, which the attacker was able to gain access to because his email Password was reset via SMS."

 

"I saw a lot of posts online. Don't really see much traction. Maybe if we combine all the Sim Swap Hack Info in One Place to try and figure out what is going on we can help catch these people. Especially since there seem to be a lot of these attacks recently."

 

Incident reported to "Coinbase, T-Mobile, [and the] FBI". Coinbase hasn't yet "responded to [their] emails or unlocked [their] account [as of March 9th]."

Reddit user SaltedAvacadosMhh reports losing 1.5 BTC that was stored on Coinbase. While they used two-factor authentication, and not SMS-based two-factor authentication on CoinBase itself, the backup of the 2FA was stored in their email. This allowed the attacker to get into their CoinBase account simply by breaching the email account.

HOW COULD THIS HAVE BEEN PREVENTED?

Backups to 2FA must be stored fully offline.

 

Check Our Framework For Safe Secure Exchange Platforms

Sources And Further Reading

 For questions or enquiries, email info@quadrigainitiative.com.

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