The popular bitcoin exchange and wallet watches its clients’ money spending, threatening to close their accounts in case of undesirable transactions, crypto activists say.

It is not the first time Coinbase receives negative feedback on Reddit. In this case, the admins of a gambling resource bitbet.us claimed that Coinbase threatened to block their customer’s account after him making a bet on their website. They stressed that the wallet “is now officially in the business to decide what you can and can't do with your own money” comparing it to Visa and PayPal.

“Should you decide to spend your Bitcoins on dildos and should Coinbase decide that dildos are something they disapprove of, they can close your account,” says the author.

Such complaints have been voiced more than once. The threat of wallet closure was received by some Coinbase users who transferred bitcoins to other platforms, including online casinos. Some people suggested moving money to other wallets before transferring it to a gambling site and using tumbling services that make it difficult or impossible to track the source of funds in question.

The ex-head of the Bitcoin Foundation Bruce Fenton commented that online wallets such as Coinbase or Circle were not to blame for transaction monitoring and users’ pursue. He insists that it is the government forcing companies to impose such measures. Fenton also stressed that there are “traitor” companies asking legislators for more regulations and rules, speaking on behalf of the entire industry.

“These folks are the enemies, not the companies forced to comply with the mess they create,” he states. 

While some users agree with him, others try to argue.

joeydekoning 

Coinbase sees the big picture. Their mission is to grow bitcoin as fast and as broadly as possible. All of their actions make sense given their mission and operating environment. Users of Coinbase are not forced to use Coinbase.

Ningrim

...My guess is entrenched companies like Coinbase/Circle prefer the regulations/licensing requirements, as they create significant barriers to competitive entry.

Ilogy

...The people most likely to pursue government compliance with passion are the people who actually believe in government compliance as a core principle. The more powerful these members of the community become, the more likely that their core philosophy of government compliance can end up transforming Bitcoin itself -- at a protocol level -- toward conformity with that philosophy.

hopeseekr

I just want to know why I was cut from $2,000/day limit to $100/day. I need to move $2,000/week just to move my paycheck...

It was certainly because I sent a single 0.25 BTC bet to BitBet the day of the drop.

45sbvlad 

You shouldn't put your eggs ALL into one basket. Some people here like to keep all their liquid assets in Bitcoin rather than hold money in a bank account. Many are young people who can afford the loss, and many have other assets.

Coinbase, founded in 2012, is a San-Francisco-based company and one of the most popular bitcoin wallets and trading platforms in the world operating in 32 countries. For registration, it requires thorough user identification and providing full bank account details.

Ludmila Brus