Coinbase Shuts Down Accounts Accessed from IP Addresses in Cuba due to Regulatory Concerns

Running a cryptocurrency exchange is not all that easy these days. Every single country around the world has different requirements to provide such services in specific regions. For Coinbase, there are some regions where providing Bitcoin exchange services is effectively prohibited. Cuba is such a region, and anyone accessing their account from an IP address in that country will see their account closed. A rather harsh stance that will cost the company a lot of customers over time.

This whole story is as strange as it sounds. One user accessed his Coinbase account while traveling through Cuba. Even though no trades were executed, the company flagged his account for closure. Apparently, accessing Coinbase from a Cuban IP address is the reason for having an account disabled. Coinbase can’t provide services in this region due to US Treasury Department sanctions. However, closing one’s account without any activity taking place seems rather strange.

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At the same time, this course of action isn’t surprising. Cuba is a very “odd” region when it comes to US business activity. Existing sanctions prevent American companies from dealing with Cuban residents. This also means accessing a US account from Cuba will result in account closure. Rest assured Coinbase is setting a rather dangerous precedent through this method, though. Luckily, it seems the decision may be reversed, depending on how customer support decides to handle this problem.

One can argue checking a Coinbase account in Cuba is asking for trouble. Everyone knows such activity will have some repercussions in the end. While an account closure is not what people would expect, the course of action can be justified as well. Coinbase is following the regulatory guidelines to a fault, which isn’t always a popular decision. We can only hope this account will be reopened, although it is unclear if that will happen.

To put this into perspective, the issue dates back to the end of May 2017. We are now close to the end of July, and the issue is still unresolved. It is evident Bitcoin exchanges have a hard time dealing with customer support tickets right now. Coinbase is not the only company getting a lot of heat from the community over their lack of response.  Companies need to step up their game and puts the customer first. So far, that is not happening, resulting in uneasy situations such as this one.

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Source: Newsbtc