Coinbase Says 99% of Customer Crypto Is Offline and Out of Hackers’ Reach

Coinbase told customers it wasn’t affected by the $6.4 billion Binance hack and detailed its security controls, including offline storage for over 99% of assets, split private keys and kill switches.

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  1. Mechanism: Offline Custody and Multi-Layered Defense: Coinbase maintains security by keeping over 99% of assets in 'cold storage'—internet-disconnected environments—and transferring funds to internet-connected hot wallets only as demand requires. To prevent unauthorized movement, they utilize split private keys that are never fully reassembled during signature processes.
  2. Risk Mitigation: Operational Controls and Anomaly Detection: Beyond storage, Coinbase limits exploitation potential through rate-limiting withdrawals and using 'kill switches' to take signing keys offline entirely in response to incidents. Their security posture explicitly accounts for insider threats and social engineering by requiring multiple approvals for sensitive actions and assuming employees are persistent phishing targets.

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