Crypto exchange Coinbase Ireland has been penalised by the Central Bank of Ireland (CBI) for a series of operational and governance failings over a five-year period.
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The fine amounts to €3,252,618 for breaching its safeguarding and outsourcing obligations under the Electronic Money Regulations 2011 between 01 November 2020 and 19 August 2025.
According to the CBI, Coinbase Ireland relied too much on its US-based parent company as an outsourced service provider to implement safeguaring measures and did not have "sufficient local skill and expertise available" to carry out these taksks, in line with Irish and EU regulatory requirements.
Furthermore, the CBI referenced "inadequate system design and insufficient control testing" and a long period of underfunding for safeguarding processes.
Coinbase Ireland admitted and agreed to the CBI's findings and also received a 30% discount on its penalty under the regulator's settlement scheme,
“Firms in Ireland must have the appropriate culture and expertise to comply with the rules, respond to risks and to protect customer interests," said the CBI's director of enforcement Karen O'Leary. "While outsourcing presents many benefits to industry, when not effectively managed, it can threaten the operational resilience of firms."
O'Leary added that the safeguarding of customers' funds is a fundamental obligation for financial services firms and the regulator has "no tolerance for weaknesses in safeguarding arrangements".
Coinbase stated that it had self-identified and reported several of the issues to the CBI in Janaury 2024 and has addressed the "vast majority"of the underlying controls issues.
"We have strengthened our safeguarding controls, redesigned our calculation processes, and added dedicated expertise to prevent similar issues from recurring,” stated Coinbase Ireland.