Even the newest users of crypto currency has likely heard of Coinbase exchange platform. This exchange is one of the biggest and most well known in this burgeoning industry. At the time of writing, they claim to have processed more than 50 billion in trades for more than 10 million customers.
These numbers are impressive and it puts the platform at the top of the charts in trade volume. What makes these big numbers even more impressive is how quickly Coinbase has risen from a small startup into a major player in cryptocurrency.
Founded in 2011, the founders Brian Armstrong and Fred Ehrsam have ridden the wave of altcoin popularity. Following their enrolment in the Y Combinator startup incubator, they attracted significant venture capital investment and by 2015 they were the first crypto focused company to receive investments from large institutions.
In 2016, the company took a new direction by slitting their operations into the buying and selling focused Coinbase and the trading focused exchange GDAX.
Not long after this, they also took the important step of gaining licensing from New York which has gone a long way towards legitimising their operations and digital currencies in general.
So what services is this platform best known for that we should cover in this review? Let?s find out.
Although the Coinbase exchange site does not offer a full range of altcoins, it does have one of the most comprehensive exchanges for the currencies it does deal in.
They are a very established company that is trusted by a large portion of the community.
Right now, the platform only supports the following cryptocurrencies for buying, selling and trading:
For these currencies, this digital marketplace offers a range of services for regular users, as well as businesses. Each of these will be detailed more below in this review.
The original, core function of Coin base is the buying and selling of cryptos.
This is available to all approved account holders. Whether you are using a web browser, or the mobile app, buying follows a simple process.
All you need to do is select your desired currency, then select the amount you would like (denominated in fiat currency or the digital currency). After this, you select the destination wallet and the payment method you prefer.
Selling is the same process, in reverse. You first visit the sells page and specify the amount you wish to sell from your selected wallet. The 'sell max' function will sell the entire contents of the wallet. Lastly, you specify the location you want the funds paid to - this is usually your bank account.
There will be a spread between the buy and sell prices of crypto coins and fiat on this cryptocurrency exchange, which varies based on volume and volatility. Depending on your country, there are also percentage fees attached to depositing and withdrawing funds. Always check and make sure you are happy with these fees before proceeding.
As you'll see in many reviews, all trading on Coinbase is now conducted on the GDAX platform. This helps to keep simple buying and selling separate from the fast paced trading that has developed. The way the trading works is through a series of currency pairings, which users buy and sell in pursuit of profits.
Currently, the trading pairs consist of the cryptos Bitcoin, Litecoin, Bitcoin Cash with the world's major currencies (EUR, USD, GBP).
The trading system works by placing a buy or sell order at either the market price, or a price you have determined that may be below or above the current trading price. This request is matched with someone looking to exit their position and the trade is executed. If there are no sellers when you are buying, or vice versa, your order is placed in a queue
Fees are quite reasonable on this platform, with a maximum of 0.25%, which goes down on a sliding scale depending on that individual traders volume for the month.
The big question is - is it safe? Can you trust this platform with your money and crypto? Let's review the advantages and disadvantages of this service to help you decide.
Given the size of the platform and the volume of trades it processes every day, it is clear that many people find the services on offer a fair deal. Before you choose to use this exchange, you will need to consider whether it is the right fit for you.
Different platforms cater to different audiences and just because this digital marketplace works for some, there is no guarantee that it will be the best choice for you. What you should look at is the usability, range of coins and most importantly, the fees for using the platform.
Coinbase is known for having a user friendly interface, however they only work with a handful of top currencies, making it unsuitable for those buying and speculating on up and coming altcoins. In terms of fees, Coinbase is on the low side, with small percentage fees for deposits, withdrawals and trading.
A big positive to note is that there is no fee for signing up for an account.
The best thing is that they are very upfront about their fee structure and you never feel cheated or fooled. Along with what we have already discussed in this review, there are some other advantages and disadvantages of this exchange which will will now expand upon.
There are several advantages to using Coinbase which will cover in this review, such as:
1. High Volume
Volume really does matter when it comes to maintaining a healthy marketplace. With so many coins passing through the platform every day, you will always find willing buyers and sellers for crypto. This helps you to maintain the liquidity of your investments.
2. Coinbase Vault
Although it is wise to have your own customized storage solution, the basic wallet that Coin base provides is a solid piece of software. It is available for both desktop and mobile and offers good security and a easy user experience.
3. Instant Transfers
One thing that is attracting more and more users to the platform is the ability to conduct instant transfers between accounts. This is only applicable for transfers between Coinbase accounts. Given the volume of trades now that are delaying blockchain transfers, the ability to send and receive crypto instantly is a game changer.
No platforms is without its disadvantages though. Coin base does have some negatives which we?ll cover in this review. These include:
1. Community Resistance
Cryptocurrencies are all about community and decentralization. One of the founding principles of the blockchain ecosystem was to remove the influence of banks and financiers from currency.
For this reason, many in the crypto community harbour real animosity towards Coinbase. This is often justified, as out of all the exchanges, Coin base is the one that is becoming increasingly corporate and ?bank like? in its behavior.
2. Account Freezes
Another big complaint that users have with this platform is the frequency at which accounts are closed or frozen. Little reason is given for these closures and appeals are generally unsuccessful.
While Coinbase likely does this to remain in line with their registration as a financial provider, it is not the kind of behavior that leads altcoin investors to trust the service.
3. Privacy - Is Coinbase safe and legit?
The amount of information that can be requested by Coinbase for the highest tier of accounts is quite high, to the point of being invasive. Some find this a deal breaker and will not deal with Coin base for this reason.
The main concerns are with this information being passed on to authorities, or having personal details stolen if there is a hack.
By now you should understand the basics of how this exchange works, which is pretty similar to how most similar platforms operate. Before you go ahead and open an account and start using the digital marketplace, you also need to understand some of the latest news, features and issues related to this platform.
Recently, some Coin base users were surprised to find an alert reminding them of their tax obligations when they logged in. Given the way the crypto community in general views government interference, this did not go down well and caused outrage.
Some users even feared that the platform may begin sharing information with the tax office.
The reality is that as one of the most established and professional trading platforms, Coinbase is inevitably integrating into the wider financial system. Whether you like it or not, if you profit from altcoins, you may be liable for tax and all Coin base has done is cover themselves by reminding users.
Coinbase continues to support a wide range of funding options - more than most other exchanges. The exact methods available to you will depend on your country, but commonly credit, and debit card deposits as well as direct bank transfers are supported. Wire transfers and Paypal are also options for US customers.
The Coinbase vault is a seperate storage account that you can open on the exchange. It can hold different cryptos in individual wallets securely. It has interesting functionality such as enhanced security and the ability to have multiple co-signers on a wallet. It is one of the more advanced online storage options available.
A big pain point for Coinbase users is account closures and limitations. In order to maintain their official registration, the company must adhere to some very specific rules, which sometimes requires them to limit or close client accounts.This is done without warning and unfortunately there is little to no recourse for the affected users.
Verification on Coinbase is not the easiest thing in the world and now requires you to supply a lot of identifying information. Depending on your account level, this can range from a driver's license, all the way to your address and tax information.
This is a particular sore point among users who value privacy. However, it is necessary if you want to use the platform.
If Coinbase doesn't sound like the right platform for you, then you could try one of these popular alternatives of other exchanges instead.
However, if you have decided Coinbase is the choice for you, let's review and have a look at how to use it for buying selling and trading step by step.
As we have shown you above, there are a number of a number of great features that make this platform a good choice as a place to buy, sell and trade cryptocoins. Here a some of those main features explained.
Of course, this all sounds great, but as a new user, how do you actually buy, sell and trade? We will now break it down for you step by step.
Purchasing cryptocurrencies on this platform couldn't be easier, to start, you should have a registered account and be logged in on either the desktop site or the phone application.
Always double check your order before placing it - once you confirm there is no going back!
Cashing out your coins on this exchange is also quite straight forward. Just like buying, login to get started.
Trading on GDAX is for more advanced users, but everyone needs to start somewhere. Follow these steps if you want to trade on GDAX.
There are also more advanced order types, however you should get started with the basics first before diving into these features in other reviews.