AWS Backend Glitch Disrupts Bitcoin Trading on Coinbase

Top cryptocurrency exchange Coinbase has confirmed a second service outage in as many days as its technical infrastructure appears to be hobbling. The exchange explained that an issue in its Amazon Web Services (AWS) infrastructure had forced a service outage, leading to error rates on its backend systems.

Coinbase Isn’t Alone

While the exchange initially explained that trading wasn’t being affected by the issue, it later confirmed that users could experience transaction problems. It also pointed out that users could see delays in their communications to its customer service systems.

The AWS issue looks to have had some broader impacts on the tech space. Thousands of companies use the cloud computing platform for daily business transactions, and some have reportedly witnessed outages this week.

In a report on the outage, Reuters confirmed that the issue appears to have originated from Amazon Kinesis, a part of AWS that collects, processes, and analyzes data in real-time. Several firms that had developed outages include Adobe Spark, streaming service Roku, video-hosting site Flickr, and the Baltimore Sun.  

The Pattern Gets Clearer

As for Coinbase, this outage isn’t entirely new. The company has suffered a spate of attacks since March, damaging its credibility significantly. The San Francisco-based exchange has suffered no less than nine operational issues in this period – ranging from connectivity problems to service outages.

Four of the outages have reportedly coincided with periods of Bitcoin’s volatility. A connectivity issue on the exchange happened on April 29 between 10 AM and 12:30 PM. Simultaneously, Bitcoin’s price jumped 4.54 percent in the same window.

On May 9, the exchange told users that it had suffered another connectivity problem. The issue occurred between 5 PM and 6 PM that day – the same period when Bitcoin jumped 15.26 percent.

The third update happened on June 1, with Coinbase claiming another connectivity problem. The incident occurred between 4 PM and 6 PM, when Bitcoin jumped 6.94 percent. Lastly, there was a problem on July 28. It occurred between 2 AM and 4:30 AM, when Bitcoin moved 3.82 percent.

The exchange has also continued to deal with problems handling increased site traffic. Earlier this month, company chief executive Brian Armstrong told users that they had been working towards improving customer support and server capacities to accommodate the influx of users.

We're working hard to add additional capacity (both in servers and customer support) to deal with increased traffic. Thank you for your patience during this time. And thank you to the team at Coinbase working hard to serve our customers! Bull runs can be exciting and stressful.

— Brian Armstrong (@brian_armstrong) November 18, 2020

However, the problem doesn’t seem to have subsided. Two days ago, sources confirmed that the exchange went down again, following a surge in the price of XRP.

Amid the crypto rally, XRP’s price hit $0.90 on Coinbase. The exchange was the first to witness such highs, with platforms like Binance and Bitstamp only seeing maximum prices of $0.79. Sadly, the exchange went down once more as traders appeared to have been in a frenzy.

Coinbase’s ability to handle operational issues will tell on its performances in the future. With digital assets on a rally, traders could do with fewer problems on their preferred platforms.