The recent surge in Bitcoin's price, which saw it climb to over $60,000, has led to technical difficulties for Coinbase, one of the leading cryptocurrency trading platforms.

Users of the Coinbase app reported seeing a zero balance in their accounts, sparking widespread concern and confusion. This issue was attributed to a glitch within the app, coinciding with a significant increase in demand for Bitcoin and other cryptocurrencies.

The problem was first acknowledged by Coinbase on February 28, 2024, as the company assured users that their assets were safe and that it was actively investigating the issue.

Coinbase CEO Brian Armstrong attributed the outage to a "large surge of traffic" that overwhelmed the exchange's infrastructure.

This surge in traffic and interest in cryptocurrency trading was likely fueled by the recent approval of U.S. spot Bitcoin ETFs and anticipation of Bitcoin's halving event in April, which historically has led to increased investment in the cryptocurrency.

The technical glitch not only caused user accounts to display a zero balance but also led to errors in buying or selling, as well as severe delays in transferring funds over the Ethereum ERC-20 network.

The incident has sparked outrage among crypto enthusiasts on social media, with many users expressing frustration over their inability to access their funds or execute trades during a critical time of market activity.

Despite the initial panic, Coinbase has repeatedly assured its users that their assets are secure and that the company is working diligently to resolve the issue.

This event underscores the challenges that cryptocurrency exchanges face in managing large surges in traffic and trading activity, especially during periods of significant market volatility. It also highlights the importance of robust technical infrastructure and customer support to address and mitigate the impact of such issues promptly. As of the latest updates, Coinbase was beginning to see improvements in customer trading, although some users may still experience errors due to ongoing high traffic levels on the platform.

HOW DID THE COINBASE OUTAGE AFFECT BITCOIN'S PRICE

The Coinbase outage, attributed to a "large surge of traffic," coincided with a significant increase in Bitcoin's price, briefly surpassing $64,000. As a result of the outage, many Coinbase users saw a zero balance in their accounts and experienced errors in buying or selling Bitcoin. This disruption led to a sharp decline in Bitcoin's price from around $64,000 to approximately $59,500, wiping out most of the gains made during that period.

Despite this temporary setback, Bitcoin's price remained resilient, climbing back above $60,700 as Coinbase worked to restore normal operations.

The outage, which fueled speculation about a potential Bitcoin bull run, had a counterintuitive effect on market sentiment, with some investors interpreting it as a catalyst for a surge in Bitcoin's price ahead of the halving event.

HOW DID COINBASE USERS REACT TO THE OUTAGE

Coinbase users reacted to the outage with concern and frustration as many reported seeing a zero balance in their accounts and experiencing errors in buying or selling Bitcoin. Social media platforms were flooded with users expressing their worries about the situation, with some speculating on the cause of the outage, ranging from dormant users returning to the platform amid the market rally to concerns about a potential hack. The outage sparked a mix of reactions, with some users jokingly referring to it as a "rug pull" by the exchange, while others saw it as a confirmation of the ongoing bull market in cryptocurrencies.

Overall, the outage led to widespread speculation and anxiety among Coinbase users, highlighting the impact technical issues can have on investor sentiment and trust in cryptocurrency exchanges.