A court in Sao Paulo, Brazil, has ordered Coinbase to return nearly $100,000 to a user who said funds deposited into Coinbase Wallet vanished through unauthorized transactions. In court, Coinbase argued that the wallet’s private keys were fully controlled by the user. The court said the company failed to prove that the disputed transfers were initiated by the wallet holder. It also found that Coinbase did not show what security measures were in place to prevent that outcome. Based on provisions under Brazil’s Consumer Protection Code, the court ordered Coinbase to repay the full amount, along with statutory interest. The ruling centers on whether the platform could substantiate its defense rather than on Coinbase’s general custody model for wallet keys. ChainCatcher reported the decision in a brief news update.
A court in Sao Paulo, Brazil, ordered Coinbase to return nearly $100,000 to a user who said funds deposited into Coinbase Wallet disappeared in unauthorized transactions.
Coinbase argued that the wallet’s private keys were fully controlled by the user. The court said the company failed to prove that the disputed transaction was initiated by the wallet holder. It also did not prove that security measures were in place to prevent that result.
The court based its ruling on provisions of Brazil’s Consumer Protection Code and ordered Coinbase to repay the full amount plus statutory interest, according to ChainCatcher.
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