It’s fair to say that some aspects of cryptocurrency are complex. This is especially true if you are just starting to dive into this fast-growing asset class.
There are thousands of different tokens and multiple blockchains to work with when buying, selling, and moving cryptocurrency assets.
For added security, you may decide to start buying cryptocurrency on one exchange and then transfer it back to the exchange to sell it before moving it to a self-managed wallet.
You can purchase a variety of coins from different blockchains, but not all coins are supported by the exchange you want to trade at a later stage.
All of this can increase the chances of making a costly mistake during transfer, resulting in permanent loss of your assets.
Fortunately, exchanges like Coinbase offer asset recovery tools that will expand to cover the BNB smart chain and Polygon in 2024. Previously, only Ethereum support was available.
Lost Crypto Asset Recovery – BNB Smart Chain
There’s nothing worse than that horrible sinking feeling you get when you realize you’ve made a costly mistake.
Unfortunately, this is all too common in the cryptocurrency space due to the sheer number of different coins, blockchains, and protocols that exist.
Below is a case study detailing common mistakes with BNB Smart Chain and Coinbase.
Buy Chainlink (LINK) on Binance on BNB Smart Chain. I then move the tokens from the exchange to my MetaMask wallet (which adds BNB support) so I can keep them safe, as I like the idea of it being my own bank.
In the meantime, your bank will stop supporting fiat transfers to and from Binance. This means that if you want to sell your tokens for cash, you will need to use another exchange.
Start transferring your LINK tokens to Coinbase, including creating a receiving address that you need to add to MetaMask.
However, since Coinbase does not support the BNB smart chain, we provided a receiving address on the Ethereum blockchain. It will not detect any discrepancies and will not confirm the transaction in your MetaMask wallet.
I impatiently wait for the coins to arrive in my Coinbase exchange account (not my wallet), but nothing shows up.
Previously, this would result in tokens being lost forever. They are still stored on the blockchain, but there is no way to get them into your wallet.
But now there is a way to retrieve it.
How to Use the Coinbase Crypto Asset Recovery Tool
Looking at the example above, successfully recovering a BNB smart chain transaction using the Coinbase asset recovery tool requires two important pieces of information: the transaction ID (TX) and the receiving address.
You can check this in the activity log of the wallet you used to send the tokens, such as MetaMask. You can also use the TX hash to take a closer look at transactions in BscScan.
Then you need to log in to Coinbase and go to the next page. Visit our Asset Recovery page and follow the instructions.
The process is very simple, just enter your ID and address information above and connect a self-storage wallet (e.g. MetaMask or Coinbase Wallet) where you want to receive your coins back.
If all goes well, your tokens will be successfully recovered and appear in your chosen wallet.
It is important to remember that you will still be on the BNB Smart Chain so you will need to use an exchange that supports it to sell or use a cryptocurrency bridge in your wallet to transfer your assets between chains. .
Cryptocurrency bridges create links between different blockchains. This means that cryptocurrency assets can be efficiently transferred and exchanged between blockchains.
How much does cryptocurrency asset recovery cost?
Coinbase charges a 5% fee for withdrawing amounts over $100, and small amounts are free, excluding the transaction costs of moving the on-chain assets to the wallet of your choice.
According to Coinbase, the tool’s expansion supports the recovery of approximately 3,000 tokens from the BNB smart chain that are not supported by the exchange.
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Every year a huge number of tokens are misplaced due to user error. In many cases, tokens are irretrievably lost and remain in the cryptocurrency ether forever.
Some researchers have suggested that 6 million Bitcoin (BTC), worth hundreds of billions of dollars, is currently inaccessible as of this writing.
This includes coins held in self-storage wallets that are no longer retrievable due to loss of hardware wallets, passwords, private keys, or mnemonic seed phrases.
If the above numbers are correct, it means that approximately 30% of the total number of Bitcoins that will ever exist will be lost forever.
Extrapolate this across the entire cryptocurrency ecosystem and you begin to understand the scale of the problem.
In the case of Bitcoin, for example, many people may have simply trashed their wallets or login information due to the fact that BTC was once virtually worthless.
An entire industry has been built around cryptocurrency detectives who attempt to recover lost cryptocurrencies on behalf of their owners.
There have been notable successes, especially when owners can remember some of the information needed to access their coins. However, there are many scammers operating in this field as well.
The takeaway from all of this is that even if the coins you ‘have’ today are only worth a penny, you should keep all the information you need to access them safe in case they explode one day.
Of course, the same applies to any cryptocurrency holdings. This is especially true if you store it in a self-managed hardware or software wallet.
Also, double and triple check the sending and receiving networks and addresses before making any cryptocurrency transactions. It’s always worth doing a small test transfer first, just to be sure.
Need help recovering your cryptocurrency? Please contact us.