Coinbase Sued for Alleged Unauthorised Collection of Users’ Biometrics Data: Details

Coinbase crypto exchange has once again found itself in legal trouble — this time for allegedly collecting users' biometrics data without consent and authorisation. A lawsuit has been filed with a District Court in California by plaintiff Michael Massel. Through this lawsuit, Massel has alleged that the US-based crypto exchange has trespassed Illinois' Biometric Information Privacy Act (BIPA). This act ensures that no conglomerates gather and save the biometric details such as thumbprints of their customers.

Coinbase has been blamed for collecting, using, and storing the fingerprints and facial scans of its users unlawfully. Users need to register these biometrics as identifications to access their accounts as part of Coinbase's Know-Your-Customers (KYC) requirements.

The suit, however, alleges that the exchange uses this biometrics data to enhance its ‘app-based' online platform's usage and working.

The plaintiff decided to take a legal action against Coinbase accusing the exchange of disclosing his biometrics details to multiple third parties, a Decrypt report said.

“Plaintiff opened a Coinbase account within the five years immediately preceding the filing of this matter. Coinbase users, including plaintiff are instructed to setup biometric authentication for use with Coinbase's mobile app. This biometric authentication requires Coinbase users, including plaintiff, to scan their fingerprint to verify its users' identities when logging into the mobile app. Coinbase collects, stores, possesses, otherwise obtains, uses, and disseminates its users' biometric data to, amongst other things, further enhance Coinbase and its online ‘app-based' platform. Coinbase wrongfully profits from the facial and fingerprint scans it has collected or otherwise obtained from its users,” the lawsuit claims.

As of now, Coinbase has not responded to this fresh development.

The company has been encountering legal issues for a while now. Coinbase, however, claims that it maintains a strict compliance with the laws of all the regions its operating in.

In March this year, US' Securities and Exchange Commission (SEC) threatened to sue Coinbase Global over some of the crypto exchange's spot market as well as its Earn, Prime, and Wallet products. Coinbase's step to get the SEC to make its decision on its petition is being seen as a reaction to the SEC's threat to probe the crypto firm.

Founded in 2012, Coinbase is touted as the largest crypto exchange in the US and one of the largest crypto exchanges in the world.

As per Bankless Times, Coinbase clocked around 103 million users in 2022, along with nine million monthly active users.