Topic: Are you a gambler? STAY AWAY FROM COINBASE! (Read 4613 times)

Their site is deceptive, which is what matters to me.

That's a retarded rule from coinbase... I hate when service companies go down the road of "related to gambling, get lost..." yet you go to vegas and there's every bank ATM you could possible imagine there. 

From https://coinbase.com/about (emphasis mine):

"The Company At A Glance
Founded in June of 2012, Coinbase is a bitcoin wallet and platform where merchants and consumers can transact with the new digital currency bitcoin.

We're based in San Francisco, California."

Their headquarters are in the US, which is what matters.

So we also have misleading advertisement... Thank you aigeezer

I say again, emphasis added: I believe it is a huge tactical blunder for an exchange that says on its home page "Coinbase is an international digital wallet that allows you to securely buy, use, and accept bitcoin currency", and that hosts its servers in Costa Rica (according to Flagfox) - to apply parochial American rules to its non-American clients.

I don't see how this is surprising at all. They are in the US, registered as an MSB and the US does not allow online gambling. MSBs or other financial service companies must comply with the Unlawful Internet Gambling Enforcement Act (UIGEA). If they willfully allow transactions from known gambling addresses, they would be violating the UIGEA and could face legal consequences. Don't get mad at Coinbase for following regulations.

If you are outside the US, in a country where online gambling is legal, then you should really use something else as a wallet as Coinbase still has to abide by US laws.

Most game websites already inform the players about the wallets the should be using. On chain games that send coins back to the address that sent the transaction already can't allow coinbase users to play. And now this. Maybe what they should do is to raise awarness of what coinbase is doing and that they should be using an entirely different wallet service if they're going to gamble. Because using a washing service/tumber won't solve the problem for more than a single transaction.

I think closing down accounts at Coinbase does send a strong message. I would do the same.

However, tracking coins has been going on for some time.  Transactions mapping was demonstrated a few years ago:



The difference now is that exchanges that are trying to play by the rules are getting caught by their new regulatory employees and advisors who come from the established financial sector -  who are more cautious, especially as gaming is a heavily regulated sector.

This is compounded by the advance of BitLicences.

Gaming operators need to do more to educate themselves on the block chain tracking tools and the IP matching tools out there.

If not, we will get to a point where customers are stuck between exchanges that are closing down accounts and gaming sites whose customers transactions become increasingly mapped and possibly black listed.

Customers will have to make decisions about gaming with particular operators vs. ease of cashing in/out through exchanges.

I just withdrew the few BTC crumbs that were in my account at Coinbase. They won't miss me, but as a matter of principle I also wanted to close my account with them and couldn't find a way to do it on the site. Any advice on how to do it without hassle? (Phone calls or support tickets are hassle in my world. I'm a tired old man).          

Thanks for any specific suggestions.

Edit: Update. I couldn't find it anywhere on the site, but after a bit of Google sleuthing I found this link and it seemed to work: https://coinbase.com/settings/cancel

Edit: Update - a bit more detail about my situation, in case it was not clear.

I should have mentioned that I am not American. "The rules" Coinbase is trying to follow do not apply to me or to 95% of the world's populace for that reason.

I believe it is a huge tactical blunder for an exchange that says on its home page "Coinbase is an international digital wallet that allows you to securely buy, use, and accept bitcoin currency", and that hosts its servers in Costa Rica (according to Flagfox) - to apply parochial American rules to its non-American clients. I had no quibble at all with Coinbase until this came to light.

If their home page had (truthfully) said "Coinbase is an American digital wallet that allows - blah blah - if you abide by all rules that apply to American citizens" then I would have known to avoid it.

That said, I have a certain amount of sympathy for their plight. They are obviously under duress from their government. However that does not give them the right to put their international users under duress as a result.

Funnily enough, I don't even use online gambling sites but I value having the freedom to do so if I wish. Coinbase lost my account and gained nothing at all for themselves or their government.






 

Could you please explain to me how a financial institution could function without keeping track of all transactions?  And how it could interface with the "outside world" (i.e., fiat financial institutions) without being regulated in a similar fashion?  If you want bitcoin institutions to be legit, which is necessary to increase bitcoin adoption, they will have to be regulated in a similar fashion to fiat institutions.

It sounds like were opening up a can of worms here.
That said all I know for certain is that if a service is monitoring and tracking every financial transaction with or without my consent and this applies to all users, I don't want any part of it.

Their is a reason that the law operates with the words innocent until proven guilty beyond the shadow of a doubt not from the perspective of if this is suspicious but we don't have enough evidence we will take preventive actions without our due diligence.
A precedent like this is concerning and its not what I would expect of a new financial industry there is compliance and then their is monitoring with a fine toothed comb for any mistakes.

This is just a taste of things to come.

Coinbase are operating to the letters of the current laws. They will have even more restrictions when BitLicences come out and other States start adopting them.

If you can't see the writing on the wall, then yeah, this sounds unfair.

The legal team at Coinbase will be advising the directors of Coinbase and the responsible shareholders. They are personally responsible and none of them will want criminal proceedings against them - not with a US justice system that operates on the basis of forced negotiations and strong arm tactics to obtain admissions of guilt instead of going to trial.

You have to remember that online gaming in the USA is illegal. That also means that US citizens using overseas gaming sites creates arrest warrants for the overseas gaming firms, plus those who facilitate the transactions.

Because the tools available to track bitcoins are common and relatively easy to use for firms such as Coinbase, they will have a duty to use them.

They are among the most able from a technical point of view to deploy block chain tracking. They would have no defense for facilitating or participating with illegal gaming on US soil - if that is what Federal and State law enforcement officials interpret as their actions.

Add to that the vested interests that forced the laws through to make online gaming illegal, who would be pushing for those that enable Bitcoin to be used to skirt around their laws to be arrested.

Sorry, but this problem is just the tip of the iceberg. that is the price for mass adoption of Bitcoin. Satoshi saw it in 2010 - please see sig for reference.

It sounds pretty reasonable to me.  Why would a company want to be involved in illegal activities?  What's the point of having laws if they're just going to be ignored?

Edit: And how would you expect them to be able to interface with fiat banking services without knowing who you are and monitoring your activities?  Having my identity attached to an account seems like a good thing.  Otherwise people could steal my money, and I'd have no way of proving it was ever mine to begin with.

Just as easy to follow .001 as it is to follow 10000 on the blockchain.

Can anyone even confirm if this is true?? I'm thinking its only on people sending massive amounts of money back into the account looking to cashout into threre bank account ?

The exchanges sees bitcoins coming in the account and out of the account... DRK doesn't matter. (No offense)

coinbase is turning into paypal.

Mix your coins with DRK then let them try to track you 

How do they just "know" the major wallets to online gambling sites?  There's been some information sharing for sure.

thanks ill stick with Bitcoin Core as i heard it helps improves the network (though i dont know if its true)

Oooh better not gamble online, it hurts so many people, must only do it in real life then daddy is ok with it  

Like the guy above said, wash your coins through darkcoin, then cash out.

What are the extents of their definition of 'tainted coins,' because honestly that's what this is. How do they determine what coins are tainted? How many jumps from 'tainted' addresses before they are considered clean? Are they ever considered 'clean' if they were ever at a 'tainted' address?

This is precisely why we need something like Dark Wallet or Darkcoin. There wouldn't even be a discussion about this if it wasn't possible to trace the path of the coins.

Well, it is up to you.

The problem of long confirmation time of your transaction was very likely just bad timing.
And if you don't have much problem storing the whole block data in your computer, I would suggest you to stick with Bitcoin Core. 

So i should stick with Bitcoin Core? and it was just bad timing with my transactions?

On average, a bitcoin transaction with standard fee and no unconfirmed inputs should be confirmed in ~10 minutes, but it may also take just 10 seconds or more than an hour for the miners to find the next block.

Using different wallet clients won't change the confirmation time, as long as your transaction is broadcast to the network successfully.

okay now im having another issue. Bitcoin Core is taking too long to confirm my receiving transactions, (from what i understand it takes an hour for the transactions to confirm but i cannot wait an hour) or is there another desktop bitcoin wallet that has the address switching feature of bitcoin core but has the instant confirmation of multibit? P.S. I really appreciate your help.

If you don't see this in the bottom, it means that your wallet is not synced yet. There should be a bar showing you the progress of downloading the blockchain. This might take a while depending on your internet connection. Once your wallet is synced, you'll be able to see all incoming transactions.

is there a way that i can see it happening? because i currently have it and it doesnt show me the transaction. thanks for your help

I was not just blaming coinbase, I'm aware that they're following the law which tends to be strict. It's obvious that a multimillion dollar company doesn't want to take any legal risks but if you aren't aware of what's happening, they're shutting down accounts of people because of the law.

They would obviously have to monitor transactions in order to do this, bigasic mentioned that they have software that does this. But its not only that, accounts have been shut down just for receiving/sending coins to what is mentioned as an unlawful service. So if someone sends coins from Silk Road to an address of yours, coinbase has the right to terminate your account and deny you access to any of their services. All this even if you live in neverland and US laws should have no effect on you. In addition there would be a record of you engaging unlawful activities from a company that closely cooperates with central authorities.

Does that sound reasonable to you? A wallet that (aside of all the negative things I mentioned before) monitors your transactions and asks for your personal information? That's why I'm saying that using coinbase as a wallet service is madness.

Yea won't washing your coins pervent them from knowing??  Just wash them 2 or 3 times

I think everyone's overreacting here, or at least those who are blaming Coinbase probably shouldn't be.  These changes were likely encouraged by their legal team.  They can't risk being caught knowingly helping others to fund illegal activities.

It's certainly over-the-top to suggest that Coinbase doesn't care about freedom.  That's completely unfair.

Ok but you can't buy and sell if your account has been closed down.  As we don't know their procedures we don't know what precautions we need to take.  That is, is sending coins from a gambling site to a wallet to cb good enough?

My last transfer from a gambling site to cb was in April and sold some to cb in May and the rest 2 weeks ago.  I haven't sent from cb in over a year.


I would recommend Electrum.  No downloading the blockchain and no reason to back up anything ever.  Just save your seed in a secure location(s) and as I say it doesn't matter if your computer falls in a vat of acid.  You can also have multiple wallets. 

I actually had a conversation with a support person regarding them suspending accounts and they told me that they have sophisticated software to determine if someone is doing something suspicious. This told me that they know the major wallets to most of the gambling sites, also, I assume that they can tell if your transaction went thru tor. So, the key is to either bag coinbase if you are going to use it for gambling or other stuff of use a separate wallet so your coins can sit there for a while. Or use a mixing service.

Something tells me they can tell if you have gambled or used the dark net.. Maybe not, but I wouldn't put it past them..

But, to defend them a bit, they have to abide by strict us laws, if they knew that your coins were coming from a known gambling site, it would put them in jeopardy to lose their licenses.

Naturally, laws from the US don't affect you at all since you live on Australian territory. But you can be affected by proxy. In this case for example coinbase has to comply with FinCEN's (and other) regulations so no matter where you live if you're using them as a wallet they have the right to stop providing you their services for doing anything that is considered unlawful in the US through them. What's would be a solution to this?
Just don't use them to store coins, downloading and running a wallet on your own would be the best solution in my opinion.


Choose a wallet that fits your needs here:
https://bitcoin.org/en/choose-your-wallet

Even in this page you'll see that coinbase doesn't offer even the basic features other wallets offer. Let me mention some important stuff among others.



By using coinbase:

• You don't have access to private keys nor you can export them.
• your coins don't stay in the address you put them in.
• Because of the above, you can't receive coins from an address they're being send after you withdraw.
• You are asked to give out personal information in order to create an account.
• Absolutely no access to any of the wallet's functions while you're not connected to the internet.

Furthermore it's relatively easy for people to find the email address you've signed up with and it has been done before. Although it's not as important, there've been mass attempts to con users out of their coins. Someone found all the registered emails and massively send withdraw orders to everyone.

In conclusion, if you like the freedom bitcoin offers, using coinbase as a wallet is something more than stupid. It's a sin. Just donwload a wallet and get access to all the features bitcoin can ofer to you. Because you should be the one with control on your coins, not a multimillion corporation. To me it feels like Coinbase is becoming what Satoshi was trying to abolish.

Can anybody let me know how these laws affect us in Aus, i will look into it myself soon and edit post if no reply, thanks.

A bit of an overreaction to avoid Coinbase altogether?

Why not just send your coins to an intermediate wallet like blockchain's wallet before sending to your gambling site of choice.

Coinbase is a regulated US money service business and needs to follow these laws or risk being shut down.

Wait, is online bitcoin gambling sort of unlawful and illegal now in the US? 

Sounds like a very smart move alani
I don't use coinbase but I would seriously consider my alternatives given that clause in their contract.

This sucks so bad

Bitcoin core.

I wonder how long it takes for other trading platforms to do the same as Coinbase.

coinbase was my first wallet too, and i decided to move my bitcoins to my multibit account, however i miss the feature that coinbase had which made a new address for every transaction, do you guys know and desktop wallets that does that because i cant seem to get it working with multibit.

oh i just found out that, I'm gambler
I know bitcoin since last april, first wallet I use is coinbase
I've moved all my funds to blockchain before the 10th of july and do not use it again

I agree this is very disappointing. 

I probably should bug out of coinbase but the only coins I have there are coins that I expect to eventually sell for USD to pay bills.  My guess is that this is just required by the ever increasing restrictions on bitcoin businesses and they are doing all they can to stay "legit."

A article on cointelegraph about the same issue :
http://cointelegraph.com/news/112319/coinbase-case-demonstrate-the-pitfalls-of-regulatory-compliance

No idea, but I have seen multiple persons reporting the same problem on reddit.
So to play safe, you may want to stop using coinbase.

Is this happening with everyone that deposits to a gambling website or just a few?

I knew about coinbase storing my coins but for just everyday use less than 0.05 btc i found it the easiest to use when i set it up awhile ago.
I also have a blockchain wallet that i print paper wallets off but i dont really like paper wallets.

As people always say, "if you don't have the private key, you don't have the bitcoin".
Coinbase may be a good place to buy and sell bitcoin if you are in the US, but it is never a good place to store your bitcoin.

Someone just found out that coinbase is a company that has to follow the law + that when you use an online waller you no longer have the absolute control of your funds. 

Thank you noted. I was interested in the coinbase vault but its just a more secure way of an insider stealing some. ( not saying the good people of coinbase would do that) but u cant trust anyone.
Coins will be moved back to a new blockchain address now, thanks for the heads up.
I still hope something like this won't kill coinbase because it was so easy to use even when i was new not long ago.
I guess its whatsome people still want is for some1 else to be in charge of their finacial security.

Thanks alani123 for the alert.



Exactly. You should deposit bitcoin to your exchange account only if you are going to sell the coin soon.

Steering clear of Coinbase in general.

They shut me off without explanation.  Well actually they said it was because I had multi accounts, so I closed them and then they stopped responding to me all together.

I admit i use coinbase for small transactions because i find it easy but after readind this i may have to go back to my blockchain wallet.
I dont gamble but might try a $2 bet or something very small in the future. Im outside of usa so would these laws apply to me or still not worth the risk?

Thanks for this post alani123!! will be moving all my coins from coinbase.

According US law, it is illegal for any merchants to help the customer to send funds to casinos.

I never think and never use COINBASE 

It's unwise to store bitcoin at Coinbase or on any other exchange for an extended period of time...unless you like the idea of getting Goxed.  One of the advantages of cryptocurrencies is that you have the ability to protect your coins as much as you want.  I suggest protecting them well yourself.

US government, they don't want to take risk with their license.

wtf is wrong with them?

why they do that?

and who's behind that?

They are still good, but if you are using coinbase for gambling then you are not safe,
Coinbase will close your account and ask you to transfer your coins.

what happened?

they used to be good

The best potection and use cold storage this is my opinion

I believe that we're coming to this as a result of the millions of dollars that was invested to them. They're playing it safe. But using coinbase as a bitcoin wallet is pointless now. You don't even have control over your own coins and now your account could be shut down at any given time just for sending out a transaction to a suspicious website. This is all the way against the neutrality bitcoin offers.

I won't let coinbase practise fractional reserve with my coins any longer. They shouldn't even been considered a wallet service any more.

Coinbase just following US law, because they abide by US law.
It is their responsiblities to do, they are giving option to withdraw.

just a way for them to steal coins from people if they think you have ties to gambling - screw that and them moved 1.4 btc out today

thx for bringing this to people's attention I admit I rarely read the fine print lol.

Interesting. Are they tracing back to hot wallets? Wouldn't that cause problems though: Let's say someone gambles at a dice site, wins and trades the BTC they receive. Whoever receives that BTC sends to coinbase, not knowing it was from gambling activities. What happens?

or you could create a blockchain wallet and transfer the BTC around a bit before sending to coinbase.

Wow this is sad R.I.P. Coinbase soon

Good idea. I wouldn't touch Coinbase with a barge pole.

i moved all my coins last week i have a very bad felling about coinbase

I'm moving all my funds away from them and it's not just because I'm a gambler. Coinbase's User Agrement was updated on July 10, I don't know if  this was added in the latest update but it's obscene. Take a look below.


I asked that this should be clarified a bit more, the response I got was that they comply to the US law and will suspend accounts that don't comply to the regulations accordingly.
Engaging to any gambling service would put your account at a risk. And it's unclear how this would affect your funds. I'm calling it now. ABANDON COINBASE! They don't respect your freedom, they monitor transactions and will shut down your account no matter where you live according to the US law.

Relevant article (not written by me):
http://www.pokersites.com/news/bitcoin-online-poker-transactions-refused-coinbase-2044