Coinbase Global Says Data Breach Could Cost Up to $400M. The Stock Is Falling. — Barrons.com
By Nate WolfCoinbase Global stock dropped Thursday after the cryptocurrency exchange reported it was the victim of a data breach that could cost up to $400 million.Coinbase revealed the cyberattack in a filing to the Securities and Exchange Commission on Wednesday, saying the company received a message on May 11 from someone credibly claiming to have internal corporate materials and information about some customer accounts.Breached data included names and contact information, partial Social Security and bank-account identifiers, government identification images, and some corporate and account data.The alleged cyberattacker, who demanded money to not disclose the information, appeared to bribe overseas Coinbase employees to obtain the files, the company said.Coinbase said it fired the workers involved and said it hasn't paid the attacker. But the indirect costs could still add up.The company estimated that expenses and customer reimbursements could total between $180 million and $400 million, with further review potentially pushing the final number lower or higher."As the Company's investigation is ongoing, the full impact of these events are not yet known," the filing said, adding that law enforcement was investigating the incident.The stock dived 7.4% in Thursday morning trading.The breach is a sour note during an eventful week for the crypto exchange. S&P Dow Jones Indices announced Monday that Coinbase would join the S&P 500 index, in a landmark moment for the crypto industry. The stock spiked 24% to $256.90 the next day, with Oppenheimer analysts raising their price target to $293 from $269.Coinbase gave back some of those gains Thursday as news of the data breach circulated. Investors will now eagerly await further information about the extent of the damage.Write to Nate Wolf at [email protected] content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.