Coinbase, the popular cryptocurrency exchange, is set to introduce a new feature that will allow users to recover lost assets that were sent to unsupported blockchains such as BNB Chain and Polygon. In an announcement made on February 27th, Coinbase stated that users who mistakenly sent assets to their Coinbase accounts on these blockchains would simply need to provide their transaction ID and inbound Coinbase wallet address in order to have their assets restored.
In the past, recovering these assets has been challenging because Coinbase employees and support channels did not have access to the private keys required to reverse transactions. However, the exchange has now developed a solution to address this issue. For assets valued at less than $100, Coinbase will not charge any fees for the recovery process. However, for assets exceeding this amount, a commission of 5% will be applied.
It is worth noting that cryptocurrency exchanges, including Coinbase, typically utilize multisig wallets that are designed to support multiple blockchains and assets. This means that even if the exchanges do not display certain tokens or networks on their user interface due to regulatory reasons, they still have the technical capability to handle transactions involving those assets.
While it is theoretically possible to recover wrongly sent assets, the process often requires a significant amount of time, effort, and coordination from senior executives who have control over the exchange’s multisig wallets. For instance, earlier this year, Binance, another major cryptocurrency exchange, was charging $500 for each retrieval of mistakenly sent crypto assets.
Since its inception, Coinbase’s recovery tool has successfully retrieved $160 million worth of lost digital assets from the Ethereum blockchain. Currently, there are approximately 3,000 ERC-20 tokens that have been mistakenly sent to Coinbase via BNB Chain, and 800 tokens that have been sent via Polygon.
Coinbase has expressed its commitment to expanding the scope of this feature to include additional assets and networks. However, due to the technical complexities involved in recovering unsupported assets, the exchange cannot guarantee that all assets will be eligible for recovery in the future.
In a related incident, a user of a crypto exchange disappeared after receiving $650,000 by mistake.