According to reports, cryptocurrency traders from Georgia took advantage of a misleading price feed on the cryptocurrency exchange Coinbase to multiply their holdings by 100 times.
The glitch, according to Coinbase, was caused by “a third-party technical fault”, which increased the foreign exchange rate for the bitcoin and altcoin trading pairs pegged to the Georgian Lari (GEL), the country’s fiat currency. GEL was then listed for $290 instead of $2.90, an increase of about 100 times.
Unofficial confirmation of the entire amount lost in the incident ranges from $14 million to $140 million, according to sources.
According to reports, some 1,000 Georgian Coinbase customers took advantage of the flaw to withdraw $100 for up to $10,000 to their local banks. However, the problem has currently been fixed, and the exchange has already started steps to retrieve any lost money.
Coinbase has already contacted the banks of the people who exploited the issue to demand that the money be returned to them. In response to the appeal, a few Georgian banks have frozen the accounts of the alleged offenders.
In one instance, a bank sent the user a letter stating, “Hello, 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 a clawback of the funds. Sorry.”
The list of supported nations by Coinbase presently doesn’t include Georgia. Last month, a group of cryptocurrency users led by George Kattula, a resident of Georgia, filed a lawsuit against Coinbase. They claimed that they were unable to sell their underperforming tokens due to the company’s arbitrary account freeze.