Coinbase is on the world’s leading digital asset platform, enabling users to buy, sell, and withdraw cryptocurrency from their accounts. Since the platform handles large sums of money, it is no surprise that Coinbase takes security seriously, ensuring its users’ safety. A result of their stringent security measures is that occasionally, users may have their accounts restricted or frozen. These measures are necessary steps to ensure all Coinbase users are protected from fraudulent activity.
This article will look at why Coinbase may restrict or freeze your account. We will also check out the steps you can take to resolve the problem and resume normal account activities.
Why Is Coinbase Account Restricted?
Coinbase is a user-friendly platform, but it can still restrict users if they break its rules and regulations. Check out several reasons why your account may have been restricted.
Breach of User Agreements
A user is considered to have violated the platform’s agreements if they no longer meet all the account specifications provided by Coinbase. Some of the reasons why accounts are restricted are:
- Not being able to verify your identity
- Transacting with a stolen credit card
- Transferring money without an approved bank account
- Breaching platform security
- Being a suspected terrorist
- Using a rooted device
Suspicious Activity
Coinbase may also restrict your account if it’s deemed to be at a high risk of crypto fraud. If the platform detects signs of suspicious activity, it will limit buying and selling until it can get to the bottom of what’s going on. Factors like numerous failed logins or logins from an unknown computer may be considered suspicious by the platform. Therefore, limiting account activity is ultimately for your protection.
Victim of a Scam
Another scenario that can result in account restriction is if you have encountered a cryptocurrency fraud scheme. The cryptocurrency market is largely unregulated at present, so it is not inconceivable that illegal activity may be taking place on DeFi (Decentralized Finance) exchanges like Coinbase. You may have unwittingly fallen prey to a cryptocurrency scam that has caused Coinbase to limit your account activity.
Information Breach
It may also be that you have been a victim of an information breach. As much as Coinbase does everything possible to ensure the safety of users’ private data, the platform can still be targeted by hackers. If your information falls into the wrong hands, Coinbase may restrict your account until the situation is sorted out.
Fraudulent Activity
Coinbase also reserves the right to terminate an investor’s account if the user engages in fraudulent activities. If users are involved in shady deals such as mining scams, they will lose access to the platform’s trading features and wallet. Weeding out unscrupulous characters maintains Coinbase’s integrity and assures other traders that this is a platform they can trust.
Transaction Issues
If a transaction received a chargeback or was reversed, it may prevent Coinbase from processing further orders. You should inform the platform’s customer support team if a recent trade resulted in either a chargeback or a reversal.
An account restriction may cause a fair amount of anxiety, but there is no need to panic. Once the pending transaction clears, the funds will be deposited in your wallet or bank account.
While you may not buy and sell crypto, you will still have access to your funds, and the limitation will not affect your previous trades. You will also be able to withdraw the funds from your wallet to an authorized bank account. Most account restrictions are resolved within a couple of days, so you should be back to trading in no time at all.
Resolve Coinbase Account Restriction
Now that we have looked at why your Coinbase account has been restricted, let’s check out some techniques to rectify the problem.
Violation of Coinbase User Agreement
An account that no longer meets the platform’s requirements is considered to violate the terms of the Coinbase User Agreement. This may apply to:
- An account where the profile is not publicly available
- An account that has been frozen for some time
- An account where numerous transactions have been made without authorization from the user
If any of the above scenarios apply to you, resolving them will restore unlimited use of your account. Complete and post your profile as required. For a frozen account or a report of unusual activity, refer to Coinbase Customer Service for help.
Unusual Activity
An account flagged as having suspicious activity will be restricted by Coinbase. If factors like numerous failed logins or unauthorized transactions pop up, the platform will stop any further trades attempted by the user.
This limitation is a step Coinbase takes to ensure that an unknown person like a hacker has not accessed the account. An excellent way to prevent unusual account activity is to sign up for two-factor authentication. Here’s how to set it up.
- Go to your Coinbase account and click on your profile picture.
- Tap “Settings” then “Security” and scroll down to the 2-step verification section.
- Press “Select” on the Authenticator App option.
- Input the 7-digit code sent to your phone, then hit “Confirm.”
- Using your authenticator app, scan the QR code that shows up.
- Type the code generated by the app into your desktop screen and tap “Enable.”
You will receive an SMS letting you know that the 2-factor authentication process has been completed. Coinbase currently supports Microsoft Authenticator, Google Authenticator, and Duo Mobile.
Changing your password will also ensure that you are the only one with access to your account. This should prevent the occurrence of any further suspicious activity reports. The steps demonstrated below will walk you through altering your Coinbase account.
- Navigate to “Settings” on Coinbase and select “Change Password.”
- Follow the prompts provided in the email you receive from Coinbase.
Uncompleted Verification Process
If you have not provided all the necessary Know Your Customer (KYC) documents, Coinbase will restrict your account to only accepting cryptocurrencies.
To resolve the issue, you should provide the requisite documents. These include a photo ID, proof of residence, and a utility bill. It usually takes a week for Coinbase to verify the account. Once the process is completed, you will be notified by email.
Additional FAQs
Can Coinbase prevent me from trading?
Yes, Coinbase can block funds from being withdrawn or transferred. The platform will hold the tokens until the appropriate identification documents have been provided.
Can I buy crypto if my account is restricted?
You will retain full access to your funds even when your account is restricted. However, you will not be able to perform any trades. With a limited account, Coinbase still allows you to withdraw crypto from your Coinbase wallet to another wallet or an authorized bank account.
Why is my account restricted after verification?
Some Coinbase functions are restricted in certain countries. You may not buy and sell cryptocurrency if you are located in an area with these limitations in place. Refer to this list to see if full Coinbase functionality is available in your region.
Restore Coinbase Account Functionality
Coinbase account restrictions protect users from fraudulent traders. The platform will limit account activity if the user agreement has been violated or there has been suspicious activity in your account. Providing the requisite KYC documents and remaining within the limits of legal cryptocurrency trade practices will limit the potential for restrictions on your Coinbase account.
Have you had your account restricted on Coinbase? What did you do to resolve the issue? Let us know in the comments below.
