Coinbase’s Decimal Point Error in Georgia

Coinbase saw a temporary bug with the currency rate of European country Georgia. The country’s national currency, the lari (GEL), was supposed to be priced at $2.90, but the bug priced the currency at $290.

Almost 1,000 users exploited the bug, allowing them to withdraw their lari holdings at a hundred times the exchange rate. Users holding $100 worth of lari were able to withdraw it to their bank for $10,000.

Coinbase reported that the bug was exploited by 0.001% of total users or around 900 customers. Although a spokesperson described the amount of the loss as a “small non-material amount”, some users who took advantage of the bug have noticed that their bank accounts have already been frozen. According to CoinDesk, Coinbase stated that the error was due to a third-party technical issue. 

Georgia is a country in Eastern Europe with a population of roughly 3.7 million. The average annual salary is about 13,112 GEL (around $4,776 USD). Blockworks reported that Georgians who have withdrawn related funds have had their bank accounts frozen. The banks involved in freezing funds have apparently done so without direction from Coinbase. With the salary range of the country, it was likely easy for banks to find potentially bugged transactions of any significantly larger amounts. 

Some users received notifications from their banks reading: “We have marked your transactions with Coinbase as suspicious and we’re locking all your accounts and cards… Please be aware that Coinbase may request clawback of funds. Sorry”. The bug was fixed about 7 hours after it was reported to Coinbase and a spokesperson stated that they are taking action to retrieve the improperly withdrawn funds. 

Users who have had their accounts frozen have found that all of their assets are frozen, including non-crypto related funds. Users were able to exploit this bug by transferring crypto purchased on another platform before selling on Coinbase or by selling crypto bought on Coinbase and withdrawing.