The crypto market has fallen into stagnation after the hype subsides, and crypto exchanges (CEX) are turning towards longer-tail and stable financial scenarios of "payment" and "financial card consumption", hoping to become the next growth engine. As giants like Binance and OKX simultaneously enter the payment market, a war about "user control rights" has officially begun. Facing fierce competition and regulatory barriers, how can crypto payment startups find a breakthrough?
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ToggleGiant Strategies: Comprehensive Analysis of Payment Ecosystem of Four Exchanges
Venture capital partner @YettaSing recently posted, analyzing how exchanges are capturing every financial behavior from financial card payments to on-chain red packets, actively transforming and evolving into more flexible crypto companies with stable cash flow:
Offshore crypto exchanges are facing a situation of marginal speculative market behavior drying up, and thus they are trying to extract maximum value (LTV) from every capital flow and financial operation.
He emphasized that while crypto payment is still far from being widespread, entrepreneurs still have ways to break through.
Crypto.com: Early Payment Pioneer
Crypto.com collaborated with Visa in 2021 and partnered with Mastercard in 2024, becoming one of the few exchanges that early bet on payment. By offering up to 8% $CRO card rewards, they attracted massive users and successfully diverted them to trading business.
During the Dogecoin hype, the platform attracted large crowds through "smooth funding channels", making its $SHIB holdings once account for nearly 20% of the exchange.
(Trump Media and Crypto.com Collaborate to Create America First ETF, CRO Surges 15%)
Binance: Not Choosing a Path, But Making Every Path Its Own
Although Binance had acquired payment startup Swipe early on, it turned to self-built payment channel "Binance Pay" focusing on zero-fee transfers, and connected with Alchemy Pay and ShopNEXT's POS to expand application scenarios. Coupled with settlement on BNB Chain and fee exemptions, Binance's strategy remains consistent: "Do everything ourselves, and then tax every transaction."
OKX: Experimental Ground for On-Chain Super App
OKX places the "Pay" button alongside Trade and Wallet on the main interface, with built-in features like red packets and USDT social transfers, following a payment route with WeChat characteristics. Next, they will connect the clearing logic through XLayer, combined with Mastercard and Stripe financial card services, targeting the "social payment" application scenario.
(Star: OKX Pay officially launched! Zero transaction fees supporting USDC and USDT, revealing ongoing contact with payment providers like MasterCard)
Bybit: Entering from Brazil, Building a DeFi Yield Bank
Bybit launched payment services in Brazil, joined offline large-scale events like Tomorrowland, and used substantial rewards to attract new users. Their greater ambition is "Mantle Banking", packaging mETH and fBTC as yield tools, forming a bank-like business model of "fiat in → DeFi interest → physical payment".
Is Crypto Payment Difficult to Popularize? Don't Fight on the Wrong Battlefield
To promote crypto payment popularization, entrepreneurs might need to first recognize a fact: "Traditional payment is already good enough, users have no reason to switch to Crypto."
It's hard to convince an Apple Pay user to switch to a complicated on-chain wallet, especially with KYC requirements, gas fees, and currency exchange losses. This is why most crypto exchanges are turning to financial cards with rewards or social red packet integration.
They know that facing this lack of motivation, they must create a "must-use" reason.
[The rest of the translation follows the same approach, maintaining the structure and translating all text while preserving any HTML tags] The final paragraph about the Coinbase hack is translated as: The US crypto exchange Coinbase reported that hackers bribed overseas customer service employees, stole user identity information, and launched social engineering fraud, further demanding a ransom of 20 million USD in Bitcoin. Coinbase refused to pay the ransom and instead set an equivalent bounty to track down the perpetrators. It is estimated they will need to pay 180 to 400 million USD for compensation and aftermath handling, raising external concerns about their cybersecurity.ToggleCoinbase Customer Service Bribed to Leak User Data, Initial Compensation Estimated at Nearly $400 Million
In a document submitted to the SEC on May 15, Coinbase admitted that overseas customer service personnel were bribed by hackers to illegally leak customer data, including addresses, phone numbers, email addresses, and identification documents, becoming tools for social engineering scams.
The company has not yet clearly specified the timing of the incident or the number of victims, only stating in its declaration: "This data breach affects approximately 1% of Coinbase's monthly active trading users."
The industry generally estimates that this incident may generate expenses of $180 million to $400 million, primarily for user compensation and system restoration operations:
This amount does not include potential litigation, insurance claims, or potential asset recovery results, so the actual cost may vary.
Refusing to Pay Millions in Ransom, Coinbase Offers Matching Reward to Track Down Hackers
Coinbase stated that after obtaining the data, hackers attempted to extort BTC worth $20 million in exchange for user personal information. Coinbase not only refused to pay but also actively offered a matching reward to track down the culprits worldwide, setting a record for the highest bounty in crypto industry history.
Coinbase CEO Brian Armstrong also emphasized in a video: "The company has filed a report and is cooperating with law enforcement, while simultaneously initiating a compensation mechanism for affected users."
The leaked data did not include users' passwords, private keys, or Coinbase Prime account information, and funds were not compromised.
Coinbase Strengthens Internal Controls, Moves Customer Service Out of High-Risk Areas
Regarding the serious security concerns, Coinbase's Chief Security Officer Philip Martin stated that all involved customer service personnel were located in India and have been immediately dismissed; he emphasized future focus on user data protection and improving employee training and review mechanisms:
We will comprehensively review internal data management and customer service processes, and consider establishing overseas customer service centers to prevent similar incidents from recurring.
He added, "In the future, we will restrict the scope of customer service access and introduce more monitoring measures to prevent abuse."
ZachXBT Warns Early: Social Engineering Scams Rampant, Coinbase's Crisis Awareness Weak
As early as February this year, blockchain detective ZachXBT had issued a warning that Coinbase users lost over $65 million to social engineering scams in just two months, with potential annual losses reaching $300 million, criticizing Coinbase for not taking sufficient measures to protect users:
These attackers often disguise themselves as official calls, emails, and websites, requesting users to verify account security, inducing victims to transfer assets to fraudulent addresses claiming to be "Coinbase secure wallets".
(Scam Disaster Zone? ZachXBT Exposes Coinbase's Slow Response, Allowing Users to Be Scammed of Over $60 Million)
Following this, the crypto community also reported receiving scam contacts impersonating Coinbase officials.
SEC Restarts Investigation, Questioning Coinbase's User Number Exaggeration for IPO
Besides the security crisis, Coinbase is now facing an SEC investigation into whether it exaggerated user numbers during its 2021 IPO. The New York Times reported that the SEC is reviewing Coinbase's claim of having over 100 million "verified users" in its registration documents, a figure that was discontinued in 2023.
Coinbase's Chief Legal Officer Paul Grewal believes that "this investigation is a 'continuation of the previous government era' and should not continue."
The so-called "verified users" include all registered accounts, non-custodial wallet users, and partners, but this statistical method no longer reflects the actual active user situation, so it has been changed to disclose "monthly active trading users" data.
The Storm Continues: Coinbase Faces Dual Challenges of Trust and Regulation
Coinbase's disclosure and response to this cybersecurity incident have received polarized evaluations from the community and media. On one hand, users and industry professionals commend its refusal to compromise and proactive reporting; on the other hand, many criticize Coinbase for not immediately explaining the data breach risks to users.
Wintermute CEO Evgeny Gaevoy stated on X:
Coinbase's failure to disclose this incident earlier is the dark side of our current absurd KYC/AML system.
This cybersecurity incident and data investigation not only severely damage Coinbase's reputation but also once again expose the structural problems in the crypto industry between "centralized customer service" and "user data protection".
Facing SEC's regulatory pressure and user trust crisis, whether Coinbase can regain trust through bounty hunting and compensation mechanisms will be the key test of maintaining its market leadership position.
Risk Warning
Cryptocurrency investment carries high risks, and its price may fluctuate dramatically. You may lose all your principal. Please carefully assess the risks.
