Coinbase, the largest US-based exchange, is taking steps to rebuild user trust amid one of the platform’s most contentious issues, account freezing.

Users decry unnecessary account freezing and unsuccessful recovery efforts despite submitting all required KYC (Know Your Customer) documentation.

Did Coinbase Finally Fix Its Account Freezing Issue?

Coinbase CEO Brian Armstrong announced a significant breakthrough in one of the platform’s most contentious issues: unnecessary account freezes.

According to Armstrong, the company has reduced account restrictions by 82%. This move could reshape how both retail users and businesses perceive the exchange.

Account freezing has been a major issue at Coinbase for longer than is acceptable. I could list a bunch of the underlying reasons why it got so bad in the first place, but what's more important is that we've made it a priority to fix, and we have been making good progress. Shout… https://t.co/Emrq6KQhpD

— Brian Armstrong (@brian_armstrong) June 6, 2025

The Coinbase exchange executive credited the achievement to Dor Levi, the platform’s new hire tasked with overhauling the restrictions system.

Based on comments on X (Twitter), account freezes have long been a pain point among Coinbase users. Some cite the need for lengthy and opaque verification processes.

Complaints have ranged from weeks-long lockouts to repeated KYC requests, even after prior submissions.

“My account has been frozen for weeks despite submitting all required KYC documentation… This is causing real financial harm for many once loyal users,” wrote Hunter, senior ecosystem development/investment lead at Tron.

Dor Levi, who joined Coinbase nine weeks ago, outlined his team’s reforms in detail. He explained that improvements in machine learning (ML) models, enhanced infrastructure, and the addition of in-app self-service tools have allowed Coinbase to slash the frequency of freezes without compromising compliance.

“Account freezes should be rare, limited to situations that warrant them, primarily when we’re legally obligated… or protecting users…We’ve made significant investments in our ML models, infrastructure, and teams…Most restriction types will soon be resolved via self-service flows—much more efficient than before,” Levi emphasized.

New Leadership and ML Tools Drive Progress, But Legacy Issues Linger

Notwithstanding, despite viewing the progress as potentially transformative, industry insiders met the update with cautious optimism.

“Love it Brian. This has been a huge issue in the perception of Coinbase. I personally stopped using Coinbase because of the hoops needed to unlock my account,” said Mondoggg, cofounder of Resonance Lab.

Influencer Alex Becker agrees, alluding that the feature could draw users to Coinbase, potentially positioning it as a “business bank account.”

The business info required is more than my high risk processor and banks need.

— brady.xlm (@HempMillionaire) June 7, 2025

Still, the damage to Coinbase’s reputation among retail investors remains significant, indicating that Coinbase still has a long way to go before rebuilding credibility for this sector of clients.

With the 82% reduction now achieved and more updates promised, the question becomes whether Coinbase can fully reclaim its reputation beyond just being a crypto exchange, but potentially as a functional, secure platform for businesses to store and move capital with confidence.

“Damage is kinda done with retail,” crypto YouTuber Wendy O commented.  

Wendy also noted that her broad social audience across platforms has sour sentiment about the platform. Additional comments also indicate pending or unresolved cases.

“My account is restricted because I can’t produce an ownership statement of my MetaMask wallet that I use to deposit stablecoins into Coinbase,” BitPay co-founder Tony Gallippi wrote.

While Coinbase appears to be taking aggressive steps toward resolving its long-standing restriction problem, the road to restoring user trust is far from over.