The Central Bank of Ireland has fined Coinbase Ireland €3,252,618 (about $3.6 million) for breaching safeguarding and outsourcing rules over a nearly five-year period between November 2020 and August 2025, the regulator's second enforcement action against the exchange's European operations in less than a year.

Announcing the penalty on Thursday, the Central Bank said Coinbase Ireland — the exchange's Irish arm — had failed to properly protect customer funds in breach of safeguarding and outsourcing requirements under the country's Electronic Money Regulations. The €3,252,618 figure reflects a 30% settlement discount applied to an original penalty of €4,646,597, a deal Coinbase Ireland agreed with the regulator on Oct. 21. The sanction still requires confirmation by Ireland's High Court before it can take effect, according to the regulator's announcement.

What the regulator found

Coinbase Ireland is an e-money institution within the broader Coinbase Group. It issues the digital money customers use to buy crypto on the platform, and is subject to Irish and EU rules on how those funds must be protected. Safeguarding regimes of this kind are designed to keep customer money separate from a firm's own funds so that it remains available to customers even if the firm runs into difficulty.

The Central Bank identified three main failures in how the Irish unit handled its obligations:

• The company leaned too heavily on its U.S.-based parent to handle safeguarding processes required under Irish and EU rules.
• It lacked enough local expertise to oversee the protection of customer funds.
• It allowed its designated safeguarding account to remain underfunded for lengthy periods.

The regulator also faulted the firm's internal controls and its failure to flag material changes to its safeguarding arrangements. For its part, Coinbase Ireland admitted the breaches.

Karen O'Leary, the Central Bank's director of enforcement, said payment and e-money firms have afundamental obligation to fully safeguard customers' funds," adding that the regulator has "no tolerance for weaknesses in safeguarding arrangements." She said failing to honor assurances made during the authorization process, or to report material changes afterward, was "completely unacceptable."

Second enforcement action this year

It is the second enforcement action taken by the Central Bank against Coinbase's European operations this year. In May, the regulator fined a separate Coinbase entity, Coinbase Europe, €21.5 million over anti-money-laundering failures. Taken together, the two penalties — one over anti-money-laundering failures, the other over safeguarding and outsourcing — total more than €24.7 million, reflecting the range of compliance areas the regulator has scrutinized across Coinbase's European entities.

Ireland as Coinbase's EU hub

Coinbase has leaned on Ireland as its European base, securing an e-money license there ahead of Brexit and later obtaining a license under the EU's Markets in Crypto-Assets (MiCA) framework to passport its services across the bloc.

The action lands even as Coinbase pushes deeper into Europe, having recently rolled out crypto futures for traders across the region. It also underscores how the exchange's reliance on a single jurisdiction for EU market access carries regulatory risk, with Irish authorities signaling that they intend to hold firms to the commitments they made to win entry.