Coinbase and Robinhood are among several major platforms affected on Monday by the Amazon Web Services (AWS) data center outage, highlighting the risks of critical financial infrastructure relying on centralized cloud service providers.
Coinbase, the third-largest centralized cryptocurrency exchange (CEX) globally by trading volume, was impacted by the AWS data center failure, which reported "increased error rates and latency" across multiple AWS services in Northern Virginia.
The AWS disruption caused the Coinbase mobile app to crash, with multiple users reporting issues with logging in, placing orders, and withdrawing funds. The Base app was also affected.
"We can confirm that global services and features dependent on US-EAST-1 have also been restored. We will continue to work towards a complete resolution and provide updates as more information becomes available," AWS wrote in an update on Monday, about three hours after the outage was first reported.
"We are seeing early signs of recovery, and some users are now able to access and use Coinbase services," Coinbase wrote in a post on X on Monday, adding that "the team is still prioritizing this issue."
According to Max Li, founder and CEO of the AI-based decentralized data cloud platform Oort, the latest AWS outage serves as another "wake-up call" for the crypto industry.
"This highlights why decentralized solutions are crucial," Li told Cointelegraph, adding:
While no other cryptocurrency exchanges reported outages, several users of the stock trading platform Robinhood also reported delays in trade execution and application programming interface (API) issues.
"Amazon is down, Robinhood is down, Reddit is down, McDonald's is down, Fortnite is down," crypto trader Kushy wrote in a post on X on Monday.
This outage occurred six months after the last AWS failure affected trading services at least eight cryptocurrency exchanges, Cointelegraph reported in April, including Binance, KuCoin, MEXC Coinstore, Gate.io, DeBank, Rabby Wallet, and Weex.
Amazon attributed the cause of the April outage to "connectivity issues," which affected at least 12 of its services.
AWS provides cloud infrastructure for centralized exchanges, enabling them to process large volumes of trading orders with low latency. Some of the largest exchanges use it, including Binance, Coinbase, BitMEX, Huobi, Crypto.com, and Kraken.
The latest outage has reignited calls for developing decentralized alternatives to eliminate single points of failure.
Layer 1 blockchain Vanar Chain has been building blockchain-based cloud infrastructure aimed at reducing this dependency. Two weeks after the April AWS outage, Vanar launched Neutron, an AI-native blockchain layer that offers data compression ratios of up to 500:1. According to Vanar CEO Jawad Ashraf, the system allows users to store files entirely on-chain without relying on third parties.
"This opens up new possibilities: from simply storing files entirely on-chain without relying on third parties to querying and verifying actual information within the files," Ashraf told Cointelegraph.
The Internet Computer protocol is another blockchain-based alternative that provides decentralized computing, storage, and hosting through global nodes. Other Web3-based infrastructure providers include Filecoin for data storage, Akash Network for decentralized computing, and Render Network for GPU-based computing services.
Related: Ethereum attracts over 16,000 new developers in 9 months
Original article: “Amazon AWS Outage Takes Coinbase Mobile App Offline, Robinhood Disrupted”
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