Major Mistake at Coinbase! Wrong Approval Issued, $300,000 Loss!

Coinbase, the largest cryptocurrency exchange in the US, lost $300,000 after a misconfigured smart contract was confirmed.

Coinbase recently lost approximately $300,000, according to The Block. However, this was not the result of an attack, but rather a misconfigured Coinbase smart contract confirmation.

Coinbase lost approximately $300,000 in accumulated token fees after mistakenly confirming transfers to Project 0x’s “swap” contract, which was not designed for confirmations and was vulnerable to abuse.

Coinbase Chief Security Officer Philip Martin confirmed in a statement that the incident was limited to an institutional decentralized exchange (DEX) wallet, did not impact customer funds, and was resolved by revoking the confirmations and transferring the remaining assets to a new wallet.

User X “deeberiroz,” a security researcher at Venn Network, noted that a MEV bot exploited this false confirmation, quickly withdrawing tokens from Coinbase's fee-taker account.

“It looks like there was a MEV bot lurking and waiting for an error to occur; the bot was waiting for users to mistakenly approve this contract and then drain all their funds.

“Finally, their dream came true thanks to Coinbase… They made a huge profit by withdrawing all the tokens they collected from the Coinbase commission taker's account.”

*This is not investment advice.