Coinbase notifications were noticeably AWOL during the crypto crash, just when users needed them most.
Coinbase is known for sending email alerts to some users when the price of their watched cryptocurrencies rises or falls. Unfortunately, according to Mother Jones, those alerts stopped right as the market was crashing — and right when users may have been able to benefit from them most.
According to various legal experts and academics, Coinbase’s actions may not have been entirely legal. The issue stems from Coinbase initially sending some users notification emails, providing information when cryptocurrency prices rose and fell, and then apparently halting those emails without notifying users. It’s possible, even likely, that many crypto users may have lost money because they did not receive alerts.
“It’s potentially illegal,” Matthew Bruckner, an associate professor at Howard University who specializes in business law, told Mother Jones. “It could be unfair to do this, to sort of induce people to rely on the email alerts,” adding that it could be an even bigger issue if people lost money as a result of the alerts being halted.
“This seems straight up deceptive,” he said. “They said we’ll email you price alerts and then stopped doing it without saying they were [going to stop].”
Bruckner cautioned that it’s still too early, with too little information, to make a definitive assessment. But the situation certainly raises questions about Coinbase’s decision-making process. If the company’s decision can be linked to losses, however, it could potentially open Coinbase to legal liability.
“It seems plausible that they could have caused damages by inducing users to stop using other methods of checking prices by introducing emailed price alerts, and then taking them away,” Bruckner added.
Coinbase provided a statement to Mother Jones, implying the company was testing the alerts to a segment of their user base with a view to rolling the final feature out to all customers once the feedback and lessons from the pilot program were incorporated.
“We began testing email notifications for some users in January, and have since rolled out email notifications for all interested users,” Coinbase spokesperson Crystal Yang said in an emailed statement.