The Central Bank of Ireland has slapped a $24.7 million fine on global cryptocurrency exchange, Coinbase. Through a blog post released on Thursday, the crypto trading platform confirmed that Coinbase Europe Limited, its European organ reached an agreement with the apex bank over irregular reporting of transactions. 

More so, local reports established that between 2021 to 2023, the exchange only reported 31% of the total $202 billion it processed. As revealed, the EU branch of Coinbase filed around 2,700 suspicious transactions worth about $15 million. 

However, during the review period regulators unraveled 185,000 transactions with suspicious movement. While confirming the fine, Coinbase emphasized that it has strengthened its Transaction Monitoring System to prevent recurrence. 

Some of the newly introduced updates include stern pre-deployment reviews and surveillance systems to discover emerging suspicious activity. Further, the crypto exchange stressed the importance of complying with regulations, narrating how it strongly abides by AML standards. 

Recall that Coinbase is one of the earliest crypto businesses to get an e-money license after opening an office in Dublin, Ireland in 2018. The exchange holds Ireland in high regard by selecting the country as its official European crypto hub. 

Through Coinbase Europe, the exchange has the regulatory greenlight to operate across all EU member states under the new Markets in Crypto-Assets (MiCA) regulatory regime. 

Coinbase faults coding error 

In response, Coinbase established that the issue isn’t connected to any wrongdoing but is part of the compliance standards of Irish regulation. Furthermore, the crypto exchange attributed the issue to coding errors. As indicated, it emanated from three coding errors in five of the exchange’s transaction monitoring systems. 

Due to these code errors, the system failed to scrutinize some crypto addresses separated by special characters. Therefore, the internal compliance software couldn’t fully display transactions with questionable sources, as the exchange established. 

Also, Coinbase explained that it managed to unravel the issue through internal testing. Subsequently, the exchange, through its technical team addressed the issue and reviewed affected transactions. 

However, as a licensed virtual asset service provider in Ireland, the exchange is expected to ensure that systems detecting and reporting potential money-laundering risks are active at all times. According to the exchange, the apex bank calculated the fine using Coinbase’s average annual revenue in the country between 2021 and 2024. 

It is worth mentioning that between those years, Coinbase earned an estimated revenue of $480. 

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