DOJ Probes Coinbase After $20M Hack—Because Nothing Says ’Secure’ Like a Crypto Exchange Paying Ransom

Federal investigators swarm Coinbase following a $20 million ransom payment to hackers—proving once again that crypto’s ’unhackable’ ethos is about as solid as a meme coin’s whitepaper.

Behind the breach: The Justice Department’s cyber unit dissects the attack vector, while Coinbase users wonder if their ’cold wallets’ were warmer than advertised.

Wall Street snickers: Traders joke this is the most transparent $20M transaction in crypto history—at least the hackers filed a demand letter.

Coinbase hack reported targeted prominent executives aswell

One victim named by a person who is aware of the incident is Roelof Botha, managing partner at Sequoia Capital. The source, who asked not to be identified, said data linked to Botha’s Coinbase account, including his phone number, home address, and other personal details, was exposed.

Botha is part of the so-called “PayPal Mafia,” a circle of former PayPal executives that also includes Peter Thiel and Elon Musk. He joined Sequoia in 2003 and backed early rounds in YouTube and Instagram. In 2022, he became the venture firm’s senior steward.

The hack happened only days before Coinbase is set to enter the benchmark S&P 500 index, a milestone for the crypto field. News of its upcoming inclusion, along with a positive review from analysts, sent the stock up 20% after the announcement.

The breach underlines how the exchange’s growing profile has drawn the attention of cyber criminals, even as Wall Street grows more comfortable with companies tied to digital assets. Officials say the investigation remains active and could take several months.

KEY Difference Wire: the secret tool crypto projects use to get guaranteed media coverage