Coinbase Sues German Man Over ‘Coinbase‑like’ URL Domain Squatting

Coinbase has sued a German man, charging him with squatting on a domain with the company’s name and extorting money from it.

Tobias Honscha from Isernhagen, Germany, has been accused of cybersquatting over the Coinbase domain coinbase.de. He is said to redirect users to his app for trading physical coins and making money out of it by posing as a Coinbase affiliate. Honscha was charged in the California Federal Court on Thursday, July 24, 2025.

Coinbase said in their lawsuit, “Coinbase recently became aware that Honscha is using and trafficking in the domain coinbase​.de. in bad faith to capitalise on the goodwill that Coinbase has developed in the Coinbase name over the past decade and more,”.

What is Cybersquatting?

Cybersquatting occurs when a person registers a domain name similar to that of an established brand. The person makes a profit out of the brand’s reputation. When it comes to crypto trading sites, it could cause significant confusion among traders.

As the industry gains more prominence, cybersquatting has become a serious crisis. As a result, companies are out there protecting their identities.

Breached Affiliate Agreement

Coinbase has stated that Tobias Honscha has agreed to host an affiliate link to the crypto exchange and earn rewards from those who sign up. However, the company accused Honscha of violating the affiliate agreement, which said “an affiliate link can’t be masqueraded as being the same as Coinbase, or use words ‘Coinbase’ or ‘Coin Base’ in their domains”.

Honscha is said to have violated this term of the Affiliate Agreement by using the coinbase.de domain. The company claims that the link uses the COINBASE trademark, creating an impression that it is associated with the real Coinbase.

Pressure to Buy the Domain at an Exorbitant Price

Coinbase has accused Honscha of threatening to profit from the domain through fraud or cybercrimes unless Coinbase pays an exorbitant amount. The company also stated that Honscha announced putting the platform at risk of a phishing attack unless the company purchases the domain at the said price. It is claimed that Honscha said to compromise the official ID using unsolicited capitulation of user ID documents, passwords, and two-factor authentication codes.

The company said that it was a clear attempt to hold Coinbase hostage by weaponising user data and threatening to leak information.

Domain Exploited for Other Uses

Coinbase reported that once they asked Honscha to stop using the coinbase.de domain to host the affiliate link, the link diverted visitors to a mobile app for trading physical coins. The company also said that he operated an email service with a @coinbase​.de email ID. It allowed him to gather sensitive information from traders who mistook the site for the official one and got in touch with them.

In addition, Coinbase said that people believe the website if the domain consists of the company’s or a related trademark. The company has asked the court to grant permission to levy charges for the damages and misuse of the domain for illicit profits. They have also requested the court to stop Honscha from using the domain and transfer it back to the company as soon as possible.

In addition, Coinbase is seeking compensation for Honscha’s alleged violation of the affiliate contract. It also includes commissions he made through the domain.

Take a Look: How to Keep Your Crypto Safe From Cyberattacks?

Conclusion

The Coinbase allegations have raised the issue of cybersquatting to the forefront. It has also voiced a concern about whether affiliates are secure and pose a threat to consumers. The time has also come for brands to implement stricter strategies to protect the public from the trap of cyber squatting. Users can only be vigilant about potential scams and conduct in-depth research before signing up.