Coinbase.com is a centralized crypto exchange that holds your cryptocurrency or ‘digital assets’ for you. When you buy, receive, or hold digital assets using a Coinbase.com account, they are securely stored or ‘custodied’ for your benefit in a hosted digital asset wallet. At all times, these assets are yours – they never belong to Coinbase.
Our platform is built to secure your digital assets while ensuring that they remain readily available for trading and other services that we provide. This help page explains how we achieve this. However it is not a summary of, or a substitute for the user agreement, so please take the time to read that too!
The information on this page only applies to Coinbase.com accounts; it does not apply to Coinbase’s self-custody app, Coinbase Wallet. Self-custody wallets like Coinbase Wallet are different from hosted digital wallets on coinbase.com. We maintain the private keys to the hosted digital wallet assigned to you on coinbase.com. But on Coinbase Wallet, you, not Coinbase, are responsible for maintaining the private keys. If you want to learn more about Coinbase Wallet, then please follow this link.
Are my digital assets mine if Coinbase is holding them?
Yes! You own your digital assets just like you always have.
Coinbase maintains internal ledgering systems, like a bank or a broker, which track your account activity in real time. As a result, there is never a situation where customer funds could be confused with corporate assets.
We also will never repurpose your funds. We do not lend or take any action with your assets, unless you specifically instruct us to. Many banks and financial institutions use customer funds for commercial purposes including lending and trading, meaning that they often hold only a fraction of their customer assets at any given time. Coinbase always holds customer assets 1:1.
You can find more details in sections 2.7 to 2.7.4 of the Coinbase User Agreement.
Are my digital assets safe?
Our mission is to be the safest, most trusted, and most secure platform for accessing the broader cryptoeconomy. To uphold this mission, Coinbase takes extensive security measures to ensure your digital assets remain as safe as possible, including strategically storing a vast majority of assets offline in secure, guarded cold storage facilities. We employ best-in-class security practices to protect our systems and your assets, and offer an array of tools to users to further enhance the security of your Coinbase.com account.
We continue to adopt cutting-edge research to provide solutions to the challenges that arise from building the next iteration of the internet. One example of this is our use of secure multiparty computation (MPC), the leading technology for generating, storing and utilizing cryptographic signing keys that protect digital assets. Keys constructed and used in MPC are never in any single place at one time. Rather, each key is generated in such a way that the result is shared amongst two or more parties without any particular party seeing more than its own share, that is meaningless by itself. Additionally, signing takes place without ever bringing the shards together, which helps to prevent attackers from getting to some subset of machines and extracting key material. Furthermore, by having each MPC participant verify the transaction against policies, it isn’t possible to bypass protections installed to prevent misuse of a key.
Visit these links to learn more, including the proactive steps Coinbase is taking to protect your digital assets:
