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How is Coinbase insured?

Digital Currency

Coinbase prioritizes the security of our customer's digital currency through a combination of online “hot storage” and offline “cold” storage. Coinbase maintains 98% or more of customer digital currency in cold storage, with the remainder in secure hot servers as necessary to serve the liquidity needs of our customers. All digital currency that Coinbase holds in its online hot storage is insured. If Coinbase were to suffer a breach of its online hot storage, the insurance policy would pay out to cover any customer funds lost as a result. 

This insurance policy does not cover any losses resulting from the compromise of your individual Coinbase account. Please note that the insurance policy covers any losses from Coinbase’s hot storage resulting from a breach of Coinbase's physical security, cyber security, or by employee theft. It is your responsibility to use a strong password and maintain control of all login credentials you use to access Coinbase.

For more on securing your account, see here.

Digital currency is not legal tender, is not backed by the government, and digital currency accounts and value balances on Coinbase are not subject to Federal Deposit Insurance Corporation or Securities Investor Protection Corporation protections.

Cash Balances

If you are a U.S. customer, Coinbase pools your balance with the balances of other customers and holds those funds in either:

  • USD custodial accounts at U.S. banks;
  • USD denominated money market funds; or
  • invests them in liquid U.S. Treasuries,

all in accordance with state money transmitter laws. Funds could be held in any one of these three manners so you should not assume your funds are being held in one manner over the other. To the extent these funds are held as USD in U.S. banks, they are maintained as pooled custodial accounts at one or more banks insured by the FDIC. These pooled custodial accounts have pass-through FDIC insurance up to the per-depositor coverage limit then in place (currently $250,000 per individual).

For non-U.S. customers, funds are pooled and held as cash in dedicated custodial accounts.

*Further details about insurance coverage and other important information are available here.

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