Coinbase Breach Fallout: TechCrunch Founder Warns of Lethal Consequences
Another day, another crypto exchange security dumpster fire—but this one comes with a body count warning.
When your ’fortress’ of finance leaks like a sieve, maybe reconsider calling it ’custody.’
Crypto kidnap attempts
A number of high-profile kidnapping attempts has heightened concerns over the safety of crypto owners with significant holdings.
In January, Ledger co-founder David Balland was abducted from his home in France alongside his wife. The pair were held captive for roughly 24 hours, with the kidnappers “mutilating” Balland’s hand as part of their ransom demand, before local law enforcement recovered the executive and his wife.
In March, popular streamer and OnlyFans personality Kaitlyn “Amouranth” Siragusa was the victim of a home invasion by three armed attackers who physically assaulted her while ordering her to transfer her Bitcoin to them. She managed to fire her gun, causing the attackers to flee the scene.
In May, the father of a crypto millionaire was rescued by French authorities after being held hostage for days—but not without having his finger severed by the kidnappers. A week later there was an attempted but failed kidnapping of a woman and her child, relatives of a leading figure in France’s crypto industry.
As a result of these and other incidents, an Amsterdam-based physical security firm told Bloomberg that it had noticed an uptick in clients with large crypto holdings, prior to the Coinbase breach.
The risks of KYC data
Arrington believes that in the wake of these attacks, crypto companies that handle user data need to be much more careful than they currently are.
“Combining these KYC laws with corporate profit maximization and lax laws on penalties for hacks like these means these issues will continue to happen,” he tweeted. “Both governments and corporations need to step up to stop this. As I said, the cost can only be measured in human suffering.”
I disagree the problem is execs. The problem is the state.
The state forces companies to collect KYC data that they do not want to collect. This issue is much bigger than crypto, and regulation is the actual thing to target.
With ZK, no need for KYC.https://t.co/kszGEy2tuZ
— Balaji (@balajis) May 20, 2025
Former Coinbase chief technology officer Balaji Srinivasan pushed back on Arrington’s position that executives should be punished, arguing that regulators are forcing KYC onto unwilling companies.
“When enough people die, the laws may change,” Arrington hit back.
