Visa: Coinbase Not to Blame for Overcharges

Editor's update: The article's headline has been amended to reflect a joint statement issued by Visa and WorldPay.

Credit card processing giant Visa is pushing back against allegations that it is to blame for unauthorized charges reported by a growing number of Coinbase customers in recent days.

Earlier this month, Coinbase users began reporting that they had been overcharged -- sometimes by as much as 50 times their original purchase -- for transactions made through the popular cryptocurrency brokerage platform.

Affected customers reported being saddled with a litany of overdraft fees, in addition to an inability to pay their rent and utility bills.

Writing on Twitter, Coinbase acknowledged the problem and said that the unauthorized charges would be reversed. The San Francisco-based firm blamed the technical issue on Visa, stating that the bug stemmed from the payment processor’s recent decision to reclassify Coinbase-related transactions as “cash advances.

Coinbase overcharges
Source: Twitter

Visa, however, denied that it was responsible for the overcharges. The problem, the firm said, lay at the feet of Coinbase.

“Visa has not made any systems changes that would result in the duplicate transactions cardholders are reporting,” a Visa spokesperson told tech outlet The Next Web. “We are also not aware of any other merchants who are experiencing this issue.”

“We are reaching out to this merchant’s acquiring financial institution to offer assistance and to ensure cardholders are protected from unauthorized transactions,” the spokesperson added.

Regardless of which company is actually to blame, the incident marks the latest in a long line of public relations headaches that Coinbase has faced as it has matured from a plucky cryptocurrency startup into an industry giant with a $1.6 billion valuation.

The company has struggled to scale its operations to meet surging consumer demand, often going offline during periods of market volatility. Customer complains have also soared in recent months, owing to the fact that the firm's customer support staff has been overwhelmed with requests from new users, many of whom are new to the cryptocurrency space.

Coinbase did not immediately respond to a request for comment.

Featured image from Shutterstock.

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About the author

Josiah Wilmoth
Josiah Wilmoth

Josiah is the US Editor at CCN, where he focuses on financial markets and cryptocurrencies. He has written over 2,000 articles since joining CCN in 2014. His work has also been featured on ZeroHedge, Yahoo Finance, and Investing.com. He holds bitcoin, but does not engage in day trading. He lives in rural Virginia. Follow him on Twitter @y3llowb1ackbird or email him directly at josiah.wilmoth(at)ccn.com.