Coinbase Ireland fined $3.6 million over customer fund segregation, oversight failures

The Central Bank of Ireland has imposed a €3.25 million ($3.6 million) fine on Coinbase Ireland for breaches of customer-fund safeguarding and outsourcing requirements under the Electronic Money Regulations, the regulator said on Thursday. Coinbase Ireland admitted the violations on 21 October and accepted both the fine and a reprimand, according to the settlement notice. The penalty was reduced from €4.65 million after a 30% settlement discount and requires High Court confirmation before taking effect.

Coinbase said it had fully resolved the issues, that no customers lost money or were unable to access their funds, and that it self-reported several problems to the central bank in January 2024. The company said it has since strengthened its safeguarding controls. Coinbase incorporated its Irish subsidiary in Dublin in July 2018, obtained an e-money licence in 2019 and secured virtual asset service provider registration in 2022.

Safeguarding and outsourcing failures

The settlement notice said Coinbase Ireland’s handling of customer funds, including daily safeguarding shortfalls, reached €5.2 million ($5.8 million) in 2024. The regulator said customer funds were allowed to be mixed with money held by other Coinbase entities. For about 19 months, from March 2023 to October 2024, roughly 30 institutional clients deposited dollars into bank accounts held by Coinbase Inc. rather than accounts in the Irish entity’s name. Funds belonging to some customers who migrated from Coinbase UK were also deposited into the UK entity’s safeguarding account until 19 August 2025.

The central bank said Coinbase Ireland could not show adequate internal controls to verify that user funds were properly segregated because it was unable to accurately calculate how much it was obligated to safeguard each day. The notice added that the failures could have complicated the return of customer funds if the Irish entity had become insolvent, saying users may not have been able to promptly and fully recover their money.

The regulator also found that Coinbase Ireland relied heavily on its US parent group’s infrastructure without sufficient local expertise to oversee safeguarding. It said governance concerns raised in letters in July 2022 and March 2023 were not adequately resolved and that serious outsourcing breaches demonstrated a lack of appropriate skills and experience. Coinbase appointed a safeguarding officer in December 2024; the regulator said the company remediated the identified shortfall in June 2024 and implemented a fix for the underlying data issue in October 2024.

The penalty follows a separate €21.5 million fine against Coinbase Europe in November 2025 after more than 30 million transactions went unmonitored, resulting in 2,708 late suspicious transaction reports.