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Screenshot of a breaking news alert e-mail from Q2 2017
Many argue that online exchanges are a rip-off for users, especially when fees range anywhere from 1% to 8%. Coinbase, one of the world’s most popular digital wallets, overcharged thousands of dollars its customers instead of just taking the normal transaction fee.
It recently came clear that the overcharging happened due to a bug linked to how credit and debit cards were billed at the time of transactions.
While the issue has been fixed, many users were outraged by how Coinbase handled their accounts. Initially, it seemed it was the company’s fault. However, on their Twitter account, the technology company shared:
“We have determined that the erroneous credit and debit charges are the result of Visa reversing and recharging transactions. This was not done by Coinbase. We are working with Visa to ensure all affected customers are reimbursed.”
The bug may have affected users to made transactions through Coinbase between 22nd January and 11th February, 2018. The company went on to explain that several large banks and card issues changed the merchant category code for purchases of cryptocurrencies. They stated:
“Visa changed the MCC for digital currency purchases to a code that allows large banks and card issuers to charge consumers additional fees.”
On the other side of the spectrum, however, Visa is not anywhere near to taking the blame for the mishap. Just on the contrary, according to Antony Peyton from Banking Tech, a Visa spokesperson reported:
“It has not made any systems changes that would result in the duplicate transactions cardholders are reporting”.
Visa also reported that none of its other customers have experienced such problems. It was only Coinbase that suffered from the “bug”.
While being one of the most respected tech companies these days, Coinbase was criticized multiple times for unprofessionalism, starting with the shutting of the website when Bitcoin was hitting $20,000 to the high fees charged by the company, and now the overcharging of customers.
The digital currency community noted that the high growth of Coinbase was not something the company expected and the system shutdowns were normal. However, the company is striving to do better. For example, they just launched Coinbase Commerce, which will allow merchants around the world to accept cryptos and deposit the funds directly in their personal wallets.