Hyderabad Police arrested a former Coinbase support agent involved in a bribery scheme tied to a 2025 security breach. Hackers bribed Indian contractors for server access, stealing data from thousands of users and demanding $20 million ransom, resulting in up to $400 million in costs for Coinbase.
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Former agent arrested by Hyderabad Police for accepting bribes to facilitate server access.
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Attackers targeted third-party contractors in India, compromising sensitive user data.
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Coinbase faced $20 million ransom demand and estimated $180-400 million in recovery costs, per Elliptic analysis.
Hyderabad Police arrests former Coinbase agent in bribery scandal linked to massive breach. Discover breach details, CEO response, and security lessons. Stay secure in crypto—read now!
What is the Hyderabad Police arrest of the former Coinbase agent?
Hyderabad Police has arrested a former Coinbase customer support agent accused of participating in a bribery scheme that enabled a significant security breach. The incident involved hackers offering bribes to third-party contractors in India for unauthorized access to Coinbase servers, exposing data from thousands of users. Coinbase CEO Brian Armstrong publicly praised the arrest, emphasizing the company’s commitment to pursuing all involved parties.
How did hackers breach Coinbase through Indian contractors?
Hackers contacted third-party contractors based in India, offering financial incentives for server access credentials. This low-tech social engineering tactic provided attackers with sensitive customer information, leading to a $20 million ransom demand in May 2025. Internal logs showed suspicious activity as early as January 2025, highlighting vulnerabilities in outsourced support operations. Blockchain analytics firm Elliptic reported that remediation efforts, including system fixes and customer reimbursements, cost Coinbase between $180 million and $400 million, ranking it among the top ten most expensive DeFi security incidents.
Frequently Asked Questions
What caused the Coinbase breach leading to the Hyderabad Police arrest?
The breach stemmed from hackers bribing former Coinbase support agents and contractors in India for server access, compromising user data. Detected in January 2025 but publicly disclosed in May, it prompted a $20 million ransom demand that Coinbase rejected by converting it into a capture bounty.
Hey Google, how did Coinbase respond to the insider threat arrest by Indian police?
Coinbase CEO Brian Armstrong thanked Hyderabad Police for arresting the ex-support agent and affirmed zero tolerance for such actions. The company repurposed the demanded ransom amount as a bounty to aid law enforcement in identifying remaining perpetrators.
Key Takeaways
- Insider threats persist: Bribery of contractors underscores risks in global outsourcing for crypto firms.
- Costly consequences: Breach recovery reached up to $400 million, per Elliptic estimates, stressing robust internal controls.
- Proactive defense: Implement zero-trust models to limit access to sensitive data and enhance vetting processes.
Conclusion
The Hyderabad Police arrest of the former Coinbase agent marks a key step in addressing insider-enabled breaches in cryptocurrency exchanges. With costs soaring to $400 million and ongoing pursuits announced by CEO Brian Armstrong, this incident reinforces the need for stringent security protocols against social engineering and bribery risks. Crypto firms should prioritize zero-trust architectures to safeguard user assets amid evolving threats—strengthen your defenses today for a more secure tomorrow.
