Coinbase Data Leak Sparks Life-Threatening Security Warnings—’Users Could Die,’ Says Analyst

A chilling alert from cybersecurity experts: The latest Coinbase breach isn’t just about lost crypto—it might literally put lives at risk.

When exchanges cut corners on KYC, hackers get more than your wallet keys. They get enough personal data to bypass every layer of real-world security.

And Wall Street still insists blockchain is the ’risky’ asset class.

Stolen Info Could Lead To Physical Violence

Michael Arrington, founder of TechCrunch and Arrington Capital, didn’t hold back his concerns. In a May 20 post on X, he said this breach could lead to people “dying.”

“It probably has already,” he added. His comment wasn’t just a hot take. There’s been a wave of violent attacks aimed at crypto holders. These are not random thefts—some involve kidnapping and even torture.

I am a long time investor in and champion of @coinbase. Something that has to be said though – this hack – which includes home addresses and account balances – will lead to people dying. It probably has already. The human cost, denominated in misery, is much larger than the $400m… pic.twitter.com/ruSYKAGH7x

— Michael Arrington(@arrington) May 19, 2025

On May 4 in Paris, the father of a French crypto entrepreneur was abducted. The attackers reportedly cut off one of his fingers and sent a video to his son, demanding 5 million euros in crypto.

French police eventually rescued the victim after two days and arrested five suspects. That happened just days before Coinbase confirmed its own breach. The connection may be coincidence, but the trend is real—crypto investors are becoming targets.

Hackers Paid Off Customer Service Workers

What makes the Coinbase breach even more shocking is how it happened. According to reports, cybercriminals bribed contractors working in customer service outside the US.

That gave them a way into internal systems without needing to hack anything directly. No passwords or private keys were stolen, and no crypto funds were taken, but criminals walked away with enough personal data to pull off serious scams.

These kinds of inside jobs are hard to predict and even harder to stop. They show how weak some parts of the crypto industry still are when it comes to handling user security—especially when outsourcing is involved.

Ronghui Gu, one of the guys behind the security firm CertiK, says crypto companies really need to step up their game. He’s talking about things like limiting who can access what, using two-factor logins, and not just trusting everything by default.

On top of that, he thinks companies should keep a close eye on their systems and make sure the staff—especially the ones dealing with private info—actually know how to spot trouble before it starts.

But even that might not be enough. Gu warned that more attackers are skipping over tech defenses and going after people instead. That’s how social engineering works—tricking or bribing people to gain access.

Featured image from Unsplash, chart from TradingView