THE PHENOM CRYPTO LETTER

GM,

Welcome to this week’s Phenom Weekly Update, where the crypto world is keeping us all on edge—this time, thanks to security scares, market volatility, and, of course, politics. Coinbase is dealing with some concerning security issues, reminding everyone why self-custody still matters. Meanwhile, Eric has dropped a fresh market update, breaking down the latest price action and what’s next. And just when things were getting stable, Trump’s new tariffs are shaking up the markets, proving that macro still matters (even in crypto). Let’s get into it!

Jump to :

• CONTENT WE ARE READING

• NEWS

• CRYPTO TWITTER

• MEMES

Coinbase’s Security Problem: Users Keep Getting Scammed, and It’s Not Getting Better 

Ah, Coinbase—the golden child of U.S. crypto exchanges, beloved by regulators, institutions, and anyone who enjoys paying top-tier fees for the privilege of using a “safe” platform. Except, as a recent investigation highlights, that safety is starting to look a little... questionable.

Over the past few months, a growing number of Coinbase users have found themselves locked out of their accounts. The reason? An aggressive risk model designed to combat the other problem Coinbase has: users getting scammed out of hundreds of millions of dollars every year.

The Scam Playbook: Spoof, Phish, Steal

This isn’t your run-of-the-mill “send me one ETH and I’ll send back two” Twitter scam. We’re talking about sophisticated social engineering attacks that have netted at least $65 million in just two months, and that’s only based on data scraped from on-chain analysis and DMs—so the real number is likely much higher.

Here’s how it works:

1. Fake Coinbase support calls – Scammers spoof Coinbase’s phone number and use leaked personal data to make their targets believe their account has been compromised.

2. Phishing emails that look exactly like Coinbase’s – They even include fake case IDs to seem legitimate.

3. Redirects to cloned Coinbase sites – Victims think they’re logging in securely, but in reality, they’re handing over their credentials.

4. Withdrawal requests disguised as “security verification” – Victims are tricked into whitelisting scammer addresses, thinking they’re securing their account.

And just like that, funds disappear into the blockchain abyss.

Coinbase’s Response? Lukewarm at Best

Rather than directly tackling the issue, Coinbase’s approach seems to involve:

• Locking accounts proactively – because nothing says “customer support” like shutting down users’ access to their own money.

• Telling people not to use VPNs – which is hilarious because actual scammers block VPN users from accessing phishing sites to make their attacks look more legitimate.

• Offering near-useless customer support – Users report getting stuck in endless loops of generic responses and ghosting.

Meanwhile, competitors like Kraken, Binance, and OKX don’t seem to have this problem at nearly the same scale. So what gives?

Fixing This Shouldn’t Be Rocket Science

If Coinbase actually wants to clean this mess up, here’s a very basic to-do list:

• Make phone numbers optional for advanced users who use authenticator apps or security keys.

• Offer a “beginner” account mode that disables withdrawals—perfect for elderly or high-risk users.

• Improve transparency and support – actually flag scammer addresses, block phishing domains, and maybe... answer emails?

• Go after U.S.-based scammers legally – Many of them have terrible operational security, and Coinbase could make an example out of them.

Coinbase is in a unique position: it has the resources, regulatory goodwill, and brand trust to lead by example. But instead of making real security improvements, it’s leaving users to fend for themselves while watching millions vanish into scammer wallets.

Until they fix it, the best advice? Assume every “Coinbase support” call or email is a scam, and if you get locked out of your account, well... good luck with that.

READING CORNER

A collection of longer form content we are consuming this week 

New video update from Phenom Founder, Eric Muschinski on the current Tariff Turbulence

The prolific Fantom developer on why he quit DeFi

NEWS

Quick Hitters from the week

• Trump’s Tariff Orders Could Accelerate Bitcoin Adoption and Global De-Dollarization: Analysts suggest IEEPA orders may push countries toward BTC and weaken USD dominance.

• The Great Bitcoin Accumulation: Corporations Race to Load Up: Holding Bitcoin is becoming a long-term corporate strategy for value preservation, says Next Layer Capital’s Brandon Turp.

• FDIC Releases ‘Operation Chokepoint 2.0’ Crypto Documents: Newly revealed records fuel claims that regulators unfairly targeted the crypto industry.

• Berachain Reveals Tokenomics Ahead of Mainnet and Airdrop: Details emerge on the much-anticipated Berachain launch, shaping expectations for the ecosystem.

• Crypto Market Slips as Rebound Fades Post-Tariff Pause: Bitcoin drops below $98K, Ethereum falls 2%, and Solana plunges 7% in a sharp market cooldown.

• MicroStrategy Rebrands to ‘Strategy’ to Double Down on Bitcoin: The company reshapes its identity to emphasize its Bitcoin-focused mission.

• Elizabeth Warren Acknowledges Trump’s Criticism of Bank of America’s Debanking Practices: Calls attention to complaints involving four major banks that account for half of all grievances.

• Trump's 'Crypto Czar' Considers Bitcoin Reserve as Part of U.S. Sovereign Wealth Fund: The administration is exploring the inclusion of Bitcoin in the proposed sovereign wealth fund, signaling a potential shift in national investment strategy.

• Kraken Relaunches Staking Services in the U.S. After SEC Settlement
  Following a $30 million settlement with the SEC, Kraken has resumed its staking services for U.S. customers, offering 17 digital assets for staking.

• Bitcoin's Bull Market Faces Uncertainty Amid Trump's Trade War

  The ongoing trade tensions initiated by President Trump's tariffs on imports from Mexico, Canada, and China have led to a substantial sell-off in the cryptocurrency market. Bitcoin's price has fallen below $100,000, with some analysts predicting a potential decline to $80,000. The market's reaction underscores the sensitivity of cryptocurrencies to macroeconomic policies and global trade dynamics.

• Solana Meme Coin 'Dogwifhat' Clarifies Miscommunication Over Las Vegas Sphere Advertisement

  The team behind the Solana-based meme coin, Dogwifhat (WIF), has addressed concerns regarding its planned advertisement on the Las Vegas Sphere. Despite raising approximately $700,000 for the campaign, a spokesperson for the Sphere confirmed that no agreement exists between the venue and Dogwifhat. The Dogwifhat team stated that negotiations are ongoing and emphasized that there was no intent to mislead supporters.

THE TWITTERVERSE

A collection of the most interesting stuff on Crypto Twitter this week

Matt makes a compelling argument for why the typical 4 yr cycle may not continue. Hint* its bullish

If you feel like you aren’t booking gains like last cycle, you aren’t alone. Professional VC’s are underperforming as well.

We probably won’t see an “alt season” like last cycle where you could throw a dart and get a 10x. There is simply too much fragmentation w/ 10s of millions of coins now. Fundamentals will matter if you want returns

MEMES

For the (crypto) Culture

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