Coinbase ordered to repay $100K after wallet hack, Sao Paulo court rules

• Brazilian judge finds Coinbase liable for stolen funds
• Ruling could set precedent for wallet provider responsibility

On July 12, 2026, CoinDesk reported that São Paulo’s state court ordered Coinbase to reimburse a user $100,000 following a wallet hack, rejecting the company’s claim that it was not responsible due to self-custody user agreements. In its decision, the court found Coinbase liable for failing to provide adequate security and oversight, emphasizing the platform’s obligation to protect users’ assets.

According to the court document, the $100,000 award resulted from a case filed in early 2026 in São Paulo, where the user argued that Coinbase should have prevented the unauthorized withdrawal of funds from their account. The court noted that Coinbase’s refusal to refund the money, on grounds of “self-custody,” was insufficient given evidence of a breach originating from platform weaknesses, not user negligence.

The ruling stands out as one of the first times a Brazilian judge has required an exchange to return lost funds after a wallet security breach, highlighting the increasing scrutiny from courts on exchange security standards. The court’s logic centered on user protection, stressing that platforms offering wallet services must take proactive steps to prevent fraud, loss, and unauthorized access, regardless of the custody model advertised.

Legal experts say the case could encourage similar lawsuits by customers who have lost funds, potentially setting a precedent for exchanges operating in Brazil. The judgment also signals that courts may hold digital asset platforms to higher standards of transparency and liability, especially in light of recent increases in theft and hacking incidents.

The case further underscores regulatory momentum in Brazil, where lawmakers have considered tightening requirements for wallet providers. Some analysts expect further pressure on exchanges to revise their security practices or risk liability for customer losses in court.

In sum, the São Paulo court’s decision reflects a broader move towards protecting digital asset investors and clarifying the responsibilities of wallet providers in Brazil’s evolving regulatory landscape.