As one of the most popular cryptocurrency exchanges in the world, Coinbase has been subject to a lot of scrutiny lately – especially after a series of outages and crashes that have left users frustrated.
So, what’s causing all the problems? Let’s take a closer look.
It’s no secret that Coinbase has been experiencing some growing pains lately. After adding support for Ethereum and Litecoin last year, the platform has seen a massive influx of new users – which has put strain on its infrastructure.
In addition to this, Coinbase has also been dealing with a number of denial-of-service (DDoS) attacks – which are designed to flood the exchange with fake traffic in an attempt to overload its systems.
These attacks have been successful in causing intermittent outages and slowdowns on the platform – and they show no signs of stopping anytime soon.
To make matters worse, Coinbase is also facing increased scrutiny from regulators. In the United States, the Internal Revenue Service (IRS) is investigating the platform for possible tax evasion – which could lead to heavy fines or even criminal charges.
In Europe, meanwhile, the European Union is considering new regulations that would require cryptocurrency exchanges to comply with anti-money laundering (AML) and know-your-customer (KYC) rules. These rules would be costly and time-consuming to implement – and they could further hamper Coinbase’s ability to scale.
All of these problems are taking their toll on Coinbase. The exchange has been plagued by outages and crashes in recent months – and it seems clear that these issues are only going to get worse before they get better.
So why does Coinbase keep crashing? In short, it’s being overwhelmed by growth – both in terms of users and regulation. Until these problems are addressed, don’t expect the situation to improve anytime soon.