Blockchain News

Coinbase Launches ERC-20 Token Recovery Tool (For a 5% Cut)

Coinbase, the most popular cryptocurrency exchange in the United States, has released a set of tools to assist customers who have sent tokens to the wrong address.

Coinbase released a new set of tools on December 15th to facilitate the retrieval of ERC-20 tokens. With the asset recovery tool, nearly 4,000 ERC-20 tokens that are currently unusable will be retrievable.

Occasionally, customers will attempt to send unsupported tokens to their Coinbase wallet addresses, the company said. We had almost no hope of ever finding them.

It was stated that no one at Coinbase, including customer service reps, has access to the private keys required to undo these types of purchases. In addition, getting a response from Coinbase support is notoriously difficult, making retrieval of the tokens nearly as challenging.

Coinbase does not offer customer service for the recovery service, which is instead a web-based, user-driven program. In typical Coinbase fashion, however, it is limited to “eligible customers” without further clarification.

Customers who inadvertently deposit tokens that are not supported on the exchange will need to do two things to get them back. If an asset was lost, the Coinbase address where it was stored and the corresponding Ethereum TXID must be provided.

Without disclosing private keys in the process, “our recovery tool is able to move unsupported assets directly from your inbound address to your self-custodial wallet.”

It was also mentioned that tools were created using patent-pending technology. In addition, the system will bypass its centralized exchange infrastructure and send money directly from receiving addresses.

Coinbase confirmed that not all ERC-20 tokens can be retrieved, but they did say that “the vast majority” can be. In addition, it stated that “due to technical complexities,” there could be no assurances that previously created assets would be maintained in the future. Additional chains are not supported by the system, including BNB Chain, Chronos, Polkadot, and Solana.

There is no service charge for recoveries under $100, but a 5% fee applies to those over $100.

The new offering is the company’s most recent attempt to win back customers and stop its precipitous decline in profitability. Company executives earlier this month offered free transfers of their own stablecoin, USDC, to encourage customers to abandon Tether in favor of USDC.

Shares of Coinbase have hit a new all-time low this week. After hitting a record low of $37.60 on December 15th, COIN stock was trading at $37.81 in the extended hours of trading on December 16th, per MarketWatch.

Since the beginning of 2022, COIN has dropped a staggering 85% as investor confidence in cryptocurrency companies plummets. Brian Armstrong, CEO of Coinbase, has forecast a dismal fourth quarter, so the company’s shares are likely to continue to decline.

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