Coinbase, the second largest cryptocurrency exchange worldwide, has unveiled a new tool that will help customers recover more then 4,000 ERC-20 tokens not supported, according to the company, exclusively to TechCrunch.
“ERC-20 token” is technical terminology for any cryptocurrency created using the Ethereum blockchain. Coinbase can support hundreds of cryptocurrencies but not all. The ERC-20 self-service asset recovery tool Customers can recover various types of tokens that were sent to Coinbase addresses.
“It’s been a pain point for customers who sent ERC-20 tokens to a Coinbase receive address,” Will Robinson, vice president of engineering at Coinbase, told TechCrunch. “When people accidentally sent these assets, they were effectively stuck up until this point.”
In the past, if you sent assets not supported by Coinbase to a users’ address on the exchange, you’d get a message saying the assets were successfully delivered on-chain, but they didn’t actually go to the receiver’s wallets. Usually, these assets are unrecoverable because internal operators don’t have access to the private keys needed to reverse transactions.
Image Credits Coinbase (opens in a new window)
Such transactions make up a “small fraction of the total transfers” Coinbase receives, but from an individual user’s point of view, such an error could make for a “very bad day,” Robinson said. According to Coinbase’s website, the platform has more than 108 million verified users in over 100 countries and $101 billion worth of assets.
Robinson stated that many tokens that are ERC-20 tokens can be found on the Ethereum mainnet and have pricing information on a distributed exchange or another venue. “We make no quality representation of these assets, as they haven’t gone through our review process, but we’re facilitating the returns that accidentally sent it in the first place.”
Customers will need to provide their Ethereum transaction ID for lost assets and the contract address in order to recover funds. This tool is only applicable to certain ERC-20 tokens. In Coinbase. “For supported assets, there’s nothing to be done here,” Robinson said. “The problem doesn’t exist in the same way, because Coinbase users have access and can send them back themselves.”
This feature will be released over the next few days, but it is not available for Coinbase Prime users in Japan and Japan. There’s no recovery fee for amounts less than $100, but those worth over $100 will be charged a 5% fee – aside from the separate network feeCoinbase stated that the aforementioned applies to all recoveries.
In the long term, support for other asset recoveries beyond ERC-20 tokens could be a reality, but “no firm commitments” exist today, Robinson said. “This is a direction we know is important to users and want to drive forward.”