Coinbase reverses course after August 1 hard fork, says it will begin supporting Bitcoin Cash by January 1, 2018
The cryptocurrency online exchange Coinbase has decided to support the new bitcoin cash, days after a user exodus temporarily brought its website to a halt.
Context & Ripple Effects
When the August 1 hard fork split bitcoin in two, Coinbase initially refused to touch the new chain — and paid for it, as a user exodus briefly brought its website down. This reversal, promising Bitcoin Cash support by January 1, 2018, is the exchange conceding that ignoring a forked asset costs more than servicing it.
The decision sets up everything that follows in the coverage: Coinbase eventually enabled Bitcoin Cash trading in December, crediting balances to anyone holding bitcoin at the fork, then had to halt BCH trading on GDAX within hours when prices spiked far above other exchanges — and open an internal probe into whether its own staff traded on the announcement.
First-order effects
- Users who fled Coinbase over its initial no-support stance get a path back: balances held at the fork will be mirrored in Bitcoin Cash once support goes live by January 1.
- Coinbase's engineering and compliance teams inherit an immediate workload — integrating a second major chain it had publicly declined to build for.
Second-order effects
- Exchanges that supported Bitcoin Cash from day one lose their differentiator, shifting competition back to liquidity and fees rather than fork coverage.
- Supporting the asset exposes Coinbase to cross-exchange price gaps — the exact dynamic that later forced a GDAX trading halt when BCH hit roughly $8.5K there versus about $3K elsewhere.
Third-order effects
- If forks keep paying, 'we will evaluate each fork' becomes table stakes: Coinbase's later move to add withdrawal support for multiple Bitcoin forks across GDAX and its other properties shows the one-off reversal hardening into standing policy.
- Each new listing also widens the insider-trading attack surface, pushing exchanges toward pre-announcement information controls — the internal investigation Coinbase's CEO ordered is the template.
The trend: Cryptocurrency exchanges are being pushed from selective asset curation toward universal fork coverage, where refusing a chain costs customers faster than supporting it creates risk.