What Happens if Coinbase Goes Out of Business?
Answer
It will entirely depend on what caused Coinbase to go out of business.
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If it’s the case that Coinbase shut down and goes bankrupt due to things like bad business handling or bad capital and finance management, there’s a decent chance that Coinbase would simply notify their users that their service is shutting down, while giving them ample amounts of time to withdraw their money.
On the other hand, if it’s the case that Coinbase goes bankrupt through a hack on their cold wallet storage, it’s a lot less likely for you to gain back access to your funds even if Coinbase is FDIC insured.
Is Coinbase safe?
Since Coinbase’s inception in 2012, Coinbase still hasn’t had a single devastating hack as of yet. Knowing that exchanges get hacked all the time, we should definitely give huge props to Coinbase for keeping their platform secure for more than a decade.
But regardless — while we should hope for Coinbase to be hack-free hopefully forever, leaving all your cryptocurrency holdings on exchanges is quite irresponsible. Great and easy-to-use hardware wallets like the Ledger Nano X have existed for a while now, hence there’s really no reason for anyone to not use a hardware wallet unless you don’t know how to navigate a computer or smartphone.
To learn more about Coinbase’s security, you can refer to our article here.
Hardware wallets are mostly small flashdrive-like devices used for cryptocurrency enthusiasts to secure their funds. With a hardware wallet, you don’t need to worry about your phone or your computer getting hacked because your wallet’s keys are always secured inside the hardware wallet device.
How to protect yourself
As said earlier, exchanges get hacked all the time. To put it simply, only use exchanges such as Coinbase to buy and sell bitcoin and cryptocurrencies. It’s far better security-wise to store your funds through a reputable hardware wallet such as the Ledger Nano X. That way, you can make sure that your funds are totally secure, and that you will have access to your funds every single time.
Quick note: always purchase Ledger hardware wallets from the official website. Not on Amazon, eBay, etc. to prevent you from purchasing a fake/tampered device.
To learn more about Bitcoin and cryptocurrency wallets, you can refer to our in-depth guide here.
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