Users of cryptocurrency startup Coinbase saw repeated charges appear on their bank statements tied to their Visa credit and debit card use, prompting several rounds of statements from the companies involved.
These charges reportedly emptied bank accounts and resulted in some customers getting hit overdraft fees, while others were unable to pay for critical expenses, as CoinDesk previously reported. At the time, Coinbase claimed the issues came from their payments processing network, not from any actions instigated by the exchange. Indeed, both firms seemed to initially deny responsibility as news of the issues took shape.
A joint statement from Coinbase, Visa and Worldpay released at the end of the week disclaimed responsibility for the charges from the startup, noting that Visa and Worldpay were working to reverse the duplicate transactions.
In the statement, the companies announced that all reversals would be completed within the next few days, going on to tell customers to contact their banks if they continue to see issues.
A Visa spokesperson told CoinDesk that the multiple-charge issue appears to have stemmed from an incorrect Merchant Category Code (MCC). Payment operators like Visa use MCC codes to help process payments from merchants.
The codes tell operators what sort of transaction is being conducted, which then helps the company analyze the risk associated with the transaction.
However, payment operators do not actually influence these codes, the spokesperson said, explaining that "Visa reaffirms MCC codes. It doesn't set them and we can't change them."
The representative said expanded:
"Neither Visa nor Coinbase is responsible for changing/setting MCC codes. Visa processes transactions via our processing network, Visa.net."
Those remarks also noted that this issue was unique to Coinbase.
"Visa has not made any systems changes that would result in the duplicate transactions cardholders are reporting. We are also not aware of any other merchants who are experiencing this issue. We are reaching out to this merchant's acquiring financial institution to offer assistance and to ensure cardholders are protected from unauthorized transactions," the company said.
Normally, a merchant's acquiring bank or institution would be responsible for setting the MCC codes. Coinbase's acquirer is Worldpay, though none of the companies have confirmed that Worldpay had any responsibility in last week's charging issues.
In the joint statement, Visa and Worldpay claimed that most, if not all, charges should have been refunded to customers by this point.
However, it is possible that some refunds will take multiple days to process. According to posts on social media site Reddit, some customers are still reporting issues with their refunds as of Monday morning.
Additionally, Worldpay - beyond the joint statement issued with Coinbase and Visa - has yet to independently comment on the situation. CoinDesk contacted the firm for comment but did not receive a response by press time.
Disclosure: CoinDesk is a subsidiary of Digital Currency Group, which has an ownership stake in Coinbase.
Visa cards image via varandah / Shutterstock
The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at email@example.com.
Momentum Is Building to Block Ethereum ASICs
Several ethereum miners and developers have come forward with the goal of stopping specialized mining hardware from effectively operating on the network.
Underway since April, the controversy surro
Brazil's Largest Independent Broker Is Launching a Crypto Exchange
The parent company of Brazil's largest independent broker is setting up a cryptocurrency exchange, Bloomberg reported Thursday.
Grupo XP, which owns brokerage firm XP Investimentos, plans to launch
XRP Shot Up 75% During Friday's Bullish Trading Session
The price of XRP spiked as high as 75 percent above its opening price at one point during Friday's trading session amidst a broader market bull parade.
At roughly 14:45 UTC, the price of XRP rose
US Congressman Drafts Bills to Aid Blockchain Development
U.S. Representative Tom Emmer wants to support the development and use of blockchain technology and cryptocurrencies.
To that end, the lawmaker announced a trio of blockchain-focused bills Friday,
Report Finds Cryptojacking Instances Jumped 400% In A Year
Instances of cryptojacking malware have jumped more than 400 percent since last year, a new report finds.
A collaborative group of cybersecurity researchers called the Cyber Threat Alliance (CTA) p
Bitmain CEO Announces New 7nm Bitcoin Mining Chip
The bitcoin mining industry is having an exciting couple of days.
Just a day after Bitfury revealed a new 14nm mining chip called the Bitfury Clarke, Bitmain has upped the ante with the announcemen
Brave Browser Is Using Civic's Blockchain Platform to Verify Publishers
Privacy-focused internet browser Brave will begin using blockchain identity startup Civic's verification services to ensure publishers are paid for their content with Brave's Basic Attention Token (BA
US Navy Launches Blockchain Research in Mission to Improve Tracking System
A U.S. Navy command is exploring the potential of blockchain technology in tracking aircraft parts.
The Naval Air Systems Command (NAVAIR) – which provides material support for aircraft and airborn