Cryptocurrency trapped as Coinbase sunsets its Web3 Wallet.
Chris Groshong
On July 7, 2025, Coinbase officially shut down its Web3 Wallet feature, cutting off user access to thousands of Ethereum and Base-based assets. Many users, unaware of the shutdown or confused about what kind of crypto wallet they had, are now realizing they may have lost access to their NFTs, tokens, and transaction histories—possibly for good.
And no, Coinbase can’t help them get it back.
Your Crypto Wallet Wasn’t Really Yours
The Coinbase Web3 Wallet, integrated directly into the main Coinbase app, let users buy, sell, and interact with decentralized applications (dapps) without the friction of managing private keys. It seemed like a win: you could mint NFTs, swap tokens, and play blockchain games without ever leaving the familiar Coinbase interface.
But what many users didn’t understand, or were never clearly told, is that the Web3 Wallet was not a self-custody wallet. Unlike its standalone Coinbase Wallet app, Coinbase’s Web3 Wallet was a shared custody system. Users did not control their keys; Coinbase did.
Now that the service is gone, that design choice has left many users stranded.
“I Thought I Owned My Crypto”
Since the shutdown, Reddit forums have filled with confused and angry posts:
“Coinbase is closing our web3 wallet and erasing it from existence without helping us recover funds stuck in other chains like the bsc chain.”
— jorikisthebest, from r/CoinBase
“…Support is useless. They don’t open tickets and don’t respond.
The wallet is going to sunset with the money stuck.”
— wordsareloaded, from r/CoinBase
The issue is not just that Coinbase ended the service. It’s that a significant number of users didn’t know what kind of wallet they were using, or what would happen when the sunset date hit. And for many, that realization has come too late.
Coinbase support pages warned that once the Web3 Wallet feature was removed, users would no longer be able to access any assets held within it. Because it was a non-custodial, on-chain wallet with Coinbase-managed key access, the company cannot simply “reset” or “recover” a wallet once it’s removed from the app.
In other words: if you did not migrate by July 7, those assets are functionally lost.
A Crypto UX Problem With Real Consequences
But this isn’t just a Coinbase problem; it’s a Web3 industry design flaw. The average crypto user still cannot tell the difference between a custodial, semi-custodial, or non-custodial wallet. Many apps blur these lines in the name of convenience, hiding key management and backend structures behind friendly interfaces.
But that UX design choice has real consequences. People assumed the Web3 Wallet worked like MetaMask or the Coinbase Wallet app—products that give users control over their private keys. Instead, they were unknowingly operating within a system that, once unplugged, took their assets with it.
If anything, the Coinbase Web3 Wallet shutdown should be a lesson in how crypto apps educate users, and in how users think about digital ownership.
What Coinbase Users Can (and Can’t) Do Now
For users who still had assets in the wallet on July 7, the options are limited. Coinbase has stated that it cannot recover any funds in the discontinued Web3 Wallet.
The only possible route is if users still have the original mobile device tied to their Web3 Wallet and had previously exported the recovery phrase, which is something few users likely did. Otherwise, those funds are stuck on-chain in wallets now orphaned by their only access point.
In Crypto, Custody Is Everything
The crypto community has long preached the gospel of self-custody: “not your keys, not your coins.” But as centralized exchanges try to onboard the masses with smoother interfaces and lower friction, that clarity is becoming more opaque.
Coinbase’s Web3 Wallet sunset is not just a product shutdown. It’s a warning: if you don’t know who holds your keys, you may not own your crypto at all.