With the interest and investment in cryptocurrencies having surged this year, the requirement for safe and secure exchanges to facilitate the purchase of crypto has become increasingly important. One of the most popular exchanges that is currently available in Coinbase.

Launched in San Francisco in 2012, Coinbase operates in 32 countries and has served over 12 million customers to exchange over $40 billion in digital currencies. By 2013, Coinbase was the highest funded Bitcoin startup as well as the largest exchange of cryptocurrency in the world. Unlike other exchanges that require users to trade on a market, Coinbase allows users to trade their cryptocurrency at a set price that is based on their market value, which allows users to purchase their cryptocurrencies faster than other exchanges. Coinbase is also one of the few cryptocurrency exchanges that accepts credit cards (in addition to bank transfers).

Coinbase Website

If you signup with our Coinbase link and deposit $100 you will get an extra $10 in Bitcoin.

Visit Coinbase

Coinbase Fees

Coinbase charge fees ranging from roughly 1.49% to 3.99%, depending on your payment method, with credit card transactions resulting in fees at the higher end of the scale. Coinbase fees are generally lower than other competitors who operate a similar business model, such as Coinmama or CEX.

Currently, Coinbase only allows users to buy Bitcoin, Ethereum and Litecoin, although it does have plans to add more currencies to the platform. In respect of ‘hard forks’ of cryptocurrencies such as Bitcoin Cash and Bitcoin Gold, Coinbase have stated that they will only offer trading in these once there is guarantees in respect of security. Coinbase have stated that it will support Bitcoin Cash from 1 January 2018, although there are no current plans in place in respect of Bitcoin Gold.

In addition, Coinbase operates the GDAX exchange, which is intended to focus on professional traders.

Update: In February 2018, Coinbase starting supporting Segwit enabled Bitcoin wallets which enabled them to bring down the fees for withdrawals on the site.

Setting up a Coinbase Account

By following the below step by step guide, you will be able to buy cryptocurrency through Coinbase.

  1. Signing up – To create an account on Coinbase, all you need is your name, email address and password.
  2. Account Type – Upon request, you will be asked to confirm your email address. Once completed, you will be redirected to the startup page, where you will be first requested to confirm whether you want to create an individual or business account.
  3. Verify your Phone Number – The next step is verifying your phone number. The reason for this is to create a form of 2-factor identification in order to ensure that your account remains secure. Other 2-factor identification methods are also available, as set out below.
  4. Set up Payment Method – As stated above, Coinbase allows customers to choose from two payment methods – bank transfer and credit card. For bank transfers, Coinbase will often set up one or two small transactions to and from your account, in order to verify your account. For credit cards, a screenshot of the credit card is necessary. Bank transfers in the US can take up to 4 to 5 days to complete, or 1-3 days by SEPA transfers in the EU, while credit and debit card transactions are instant. Coinbase also allows for users to link their Paypal account to the platform, but this can be used for proceeds made from selling cryptocurrency only.
  5. Buy Cryptocurrency – Once you have funds in your account you can buy currency. It’s important to make sure that you are on the right tab of your account to purchase the correct currency. Before confirming the transaction, Coinbase provides you with details of the service fee and the amount of cryptocurrency being purchased in the transaction. Once confirmed, the amount of cryptocurrency that you have purchased will be credited to the relevant Coinbase wallet.

Coinbase Account

Is Coinbase Safe?

One of the perceptions of cryptocurrency among newcomers to the platform is that it is still risky to invest in. And although it is correct that there have been issues around cryptocurrency exchanges in the past (such as Mt. Gox),

Coinbase is considered to be one of the most secure platforms currently available. First of all, Coinbase is US based and is therefore required to comply with US State and Federal law. This can be contrasted with some of their competitors that operate in countries that may have lighter regulations when it comes to such platforms. Coinbase has actively pursued discussions with regulators in order to ensure that they were providing an open and innovative financial system and the regulation of Coinbase is considered by some to have restored confidence in cryptocurrencies following the Mt Gox collapsed (although other commentators have complained that Coinbase operates more like a bank, which, within the community, is against the fundamental nature of a decentralised cryptocurrency). In addition, Coinbase has received investment from a number of high-profile backers, including the Bank of Tokyo and BBVA, which boosts its legitimacy

When it comes to storage of funds, Coinbase is transparent about its methods. Coinbase segregates customer funds from company operational funds, with Coinbase stating on their website that any funds held on behalf of customers are stored in custodial bank accounts and, in the event of insolvency, neither Coinbase nor its creditors would have any rights or entitlements to such customer funds. In terms of its cryptocurrency storage, Coinbase states that 98% of customers’ cryptocurrency funds and stored offline, through hardware wallets and paper wallets that are stored in vaults and safety deposit boxes worldwide. In addition, Coinbase states that the remaining portion of cryptocurrency that is stored online is insured, and that in the event of a hack, customers will be entitled to receive any funds lost through this insurance policy.

Coinbase Security

Coinbase offers customers a 2-factor authentication method, which can be through SMS to your phone, or through third party apps such as Google Authenticator or Duo. In addition, Coinbase notifies users if a new device or IP address attempts to access your customer account. However, despite this, if customer accounts are compromised, Coinbase does not accept any liability for funds being lost. For that reason, it is typically recommended that once you have purchased any cryptocurrency on the Coinbase exchange, you store this cryptocurrency offline in a wallet that you control.

We have written a separate post which goes into more detail about the security of coinbase.

Coinbase Customer Support

Coinbase offers customer support through email, as well as having a Knowledge Base and FAQs page available for customers. Wait times for customer support may vary, with the huge increase in demand for the service in recent months resulting in some delays. However, typical response times tend to be within 24-72 hours. Some users have expressed frustration with receiving “canned responses” that don’t entirely address the issue raised.

Supported Countries

Coinbase serves customers in the following countries:

Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Finland, Greece, Hungary, Ireland, Italy, Jersey, Latvia, Liechtenstein, Malta, Monaco, Netherlands, Norway, Poland, Portugal, San Marino, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland, United Kingdom and the United States.

Transaction Limits

Transaction limits vary from country to country, as well as variations as a result of payment methods and verification status. You can view your limits through a link on the account’s limits page. Coinbase also allows users to apply for higher limits, although these applications are not generally applicable to credit card transactions. To apply for higher limits you will need to verify your identity and fully verified US residents can transaction up to $50,000 per week, while verified European customers may have a maximum of $30,000 in their account at any time. Users can check their limits through their account.

Transactions Using Cryptocurrency

It is easy to store, send and receive cryptocurrency through Coinbase:

  • To send or store crypto all you need to do is navigate to the Send tab of your account, choose the wallet you wish to send coins from, enter the amount and the public key of the recipient address and click send.
  • To receive cryptocurrency, you need to navigate to the Accounts tab, click on the wallet where you want funds to go and click Receive. Once you’ve clicked receive you will be provided with your account’s wallet address which can be used by the sender to transfer the cryptocurrency to you.

Coinbase Shift Card

The Shift Card is a VISA debit card that is available to Coinbase users. Shift Cards allow Coinbase users in certain US States and Territories to spend the Bitcoin in their account in any place where VISA is accepted. Shift Cards cost an initial $10 but there are no transaction fees on domestic transaction nor any fees associated with the exchange of Bitcoin to USD.

Shift VISA Card

Coinbase vs Coinbase Pro ( formally GDAX )

In 2015, Coinbase rebranded the exchange element of the company as GDAX and then againin 2018 to “Coinbase Pro”, to separate the ‘trading’ element of the exchange from the more casual consumer platform. You will find that you can avoid Coinbase fees by using GDAX as your buying / trading platform by sending a bank transfer to Coinbase and then using Coinbase Pro for purchasing.

All Coinbase customers automatically have an account on Coinbase Pro, you login with the same credentials as you would on the Coinbase website. You can find out more about the two exchanges in our Coinbase vs GDAX comparison post.

GDAX

Coinbase Pro is designed to appeal to more advanced traders who want to know more than just the basics of market fluctuations related to cryptocurrency pairs. There are real-time orderbooks, trade histories, and charting tools. At the same time, the interface on Coinbase Pro is highly intuitive, making it possible for traders to start using the platform right away.

Coinbase Pro Review

If you want to find out more about their Coinbase Pro offering, read our complete review here.

Monitoring of Accounts

One of the criticisms from the online community about Coinbase is that has been known to track where its customers send their cryptocurrency, and may ban users from making certain transfers (for example for transactions with gambling sites or darknet purchases). Coinbase is also involved in a running dispute with the IRS where they are fighting requests to hand over all customer’s financial data under a “John Doe” summons.

Coinbase Downtime

Recently, Bitcoin price has been surging to new heights, seemingly on a daily basis. During these periods of extremely high usage, there has been some downtime for the site and the app which has been causing people to be unable to trade or purchase on the system. Unfortunately these are part of the growing pains of the service which is adding customers at an unprecedented rate.

Coinbase has assured it’s customers that they are working on the scaling problem – it is not a huge deal at the moment and has only seen a few hours downtime in total but we thought we’d mention it. This seems to be a common problem across a few exchanges which are all straining under the weight of soaring usage and new people looking to get involved in Cryptocurrencies.

Coinbase Custody

Coinbase also offer custody for cryptocurrency assets for institutions in the form of their custody program, which charges a setup fee of $100,000 and a minimum holding of $10million so you can see it is aimed at banks, hedge funds and other finance institutions who would require such a service.

While the program is still in its early phase, they already have their first client and have accepted their first deposit. Custody services are a way for large financial organizations to securely deposit their assets in a way that is insured. This service, the first of its kind, could lead to larger institutional adoption of cryptocurrencies at large.

Coinbase Custody

Coinbase and Paradex

Recently, Coinbase announced the acquisition of Paradex which is a decentralized exchange for Ethereum ERC-20 tokens, they are hoping to integrate some of this into their offerings and make a wide range of tokens tradeable on their Coinbase Pro platform. This is good news for their customers and indeed any holders of coins which will be listed as this should greatly increase the exposure of these assets to a wider range of people.

Instant UK Bank Purchases

Coinbase have recently rolled instant UK bank account purchases, that means you are now able to link any UK bank and enjoy near-instant purchases of their supported currencies. It also means you can deposit and withdraw back to your bank making Coinbase one of the fastest and most efficient ways to convert your coins back to fiat. Before this step, the process took a lot longer and involved international bank transfers and more fees involved in the conversion of cryptocurrencies. If you are based in the UK, this is a huge positive for using Coinbase as your fiat on-ramp and off-ramp.

Coinbase UK Bank Account

Visit your account settings page and click “Link a New Account” to see the new UK Bank account option.

Coinbase Bundle

Another new addition to the Coinbase platform is their “Coinbase Bundle”. The bundle is an easy way to buy all 5 cryptocurrencies they currently offer ( BTC, ETH, LTC, BCH, ETC).

Coinbase Bundle

Onside your account you will see the option to purchase the Coinbase bundle, you simply enter an amount you wish to purchase and it will automatically be split between the coins as follows:

  • 75.2% Bitcoin
  • 15.58% Ethereum
  • 6.11% Bitcoin Cash
  • 2.33% Litecoin
  • 0.78% Ethereum Classic

This is an easy way to gain exposure to the coins currently available on Coinbase.

Conclusion

Although it’s not perfect, Coinbase offers customers (and especially newcomers to cryptocurrency) a practical and easy-to-use service for buying and selling cryptocurrency. However, as with any online exchange, despite the security levels outlined above, the recommendation will always be that any cryptocurrency purchased through Coinbase should be transferred to personal wallets allowing you to have full access to the private key to your cryptocurrency.

Overall, it is a good introduction to the world of cryptocurrency and allows users to dip their toe into the world of cryptocurrency without it feeling like it’s a strange new world.

Visit Coinbase

Coinbase

Coinbase
9.4

Ease of Use

10.0 /10

Reputation

10.0 /10

Fees

9.0 /10

Customer Support

8.0 /10

Payment Methods

10.0 /10

Pros

  • Excellent Reputation
  • FDIC Insured
  • Easy to Use
  • Very Secure
  • Accepts Credit / Debit Cards

Cons

  • Slow Customer Support
  • Limited Currencies Available

Posted by Oliver Dale

Editor-in-Chief of Blockonomi and founder of Kooc Media, A UK-Based Online Media Company. Believer in Open-Source Software, Blockchain Technology & a Free and Fair Internet for all.


All content on Blockonomi.com is provided solely for informational purposes, and is not an offer to buy or sell or a solicitation of an offer to buy or sell any security, product, service or investment. The opinions expressed in this Site do not constitute investment advice and independent financial advice should be sought where appropriate.

14 Comments

  1. Very good article, but I wouldn’t have put Coinbase vs GDAX, as I believe they can be used together. For example by trandfering your money from Coinbase to GDAX and then buying crypto on GDAX with no fees.

    Reply

  2. I opened an account with Coinbase. When I called them for technical support, I heard them laughing at my questions over the phone. Then they sent me an email and spelled my name wrong. Shouldn’t that be automated? I got a very “fly by night” scammy feeling from them.

    Reply

  3. Coinbase is horrible. My phone died while traveling. It had the authenticator. I no longer have that number or the authenticator seed. Been dealing with them since Jan 3, mow march 10. Called support today and the guy said to wait for an email. I’ve been waiting for over a month. He wouldn’t let me talk to ANYONE else. Waste of another thirty minutes

    Reply

  4. Coinbase’s customer service was poor and now it is horrible. Expect long delays in getting access to your funds and frequent headaches even getting on line to their site. I received multiple emails stating my funds were available only to check online and my funds are still on hold for two weeks. They claim to be updating but their service is rapidly going down hill.

    Reply

  5. I have had a coinbase account since Jan 18 can’t fault them. The only problem is linking a bank account so am unable to withdraw money if I wanted to. I hope in time this problem is solved.

    Reply

  6. Andrea J CorderyJuly 9, 2018 at 2:12 pm

    Sorry if my comment may come off rude, but I ve been seaeching for a step by step guide to getting my coinbase set up and everywhere i go i get the same thing like with your review a lot of words…!
    still not getting any closer to understanding how to use it.
    I resently got a home base job and they pay out in bitcoin.
    So far I have earned $600 and I still can not find the funds, I ‘ve opened my coinbase account and been verifed and check my coinbase everyday and all I seem to do is add more numbers to my account dashboard and I am getting so depressed and angry with myself feeling stupid, that I am ready to just quit the whole thing, because if i cant figure it out that i am working with no pay.. and the company is no help they keep sending me coinbase links and to watch youtube videos, and still not getting nowhere. Coinbase support is no help either. Why cant there be a step by step guide or live support!! Its a big company you think that they could provide this for their customers, instead having to research and never find any help.

    Reply

  7. I would not put one penny into coinbase. Their ‘support’ team is not helpful. They sound like robotswou. I don’t like the smell of the whole thing. It is in my opinion -it is not safe at all I would not do this- which is sad because I like crypto a lot

    Reply

  8. I certainly hope Coinbase is seeing these comments. Customer service is almost everything in business.

    Reply

  9. I’ve also had a problem with slow/no response from their support. Another big issue for me recently is that they have just put a 28 day “hold” on an ACH transfer in to coinbase from my bank. Which means I am locked from sending it out for 28 days. That is outrageous and I won’t be using them anymore.

    Reply

  10. why so many bad reviews. Why Coinbase is not taking any action to improve the customers problems.

    Reply

  11. Penelope WoollfordOctober 5, 2018 at 7:12 pm

    I think Coinbase is a great way to get started with crypto
    Currency and I also found the customer service team to be patient
    And helpful…….quite the opposite of some of the negative reviews here….

    Found it quite easy to use……growing and improving

    Reply

    1. have you tried to withdraw your crypto?
      trust me, these guys where very reliable in the past, now even the website is full of functional issues and withdrawing your own crypto, with a fully verified account, years old, you will have big issues and long long long delays.

      Reply

  12. For new user please register coinbase https://www.coinbase.com/join/5b8bcb8ae1a0b211d1758ce0

    Reply

  13. Do you recommend Coinbase?
    They have big issues with their website, and withdrawing your funds can be close to impossible lately.

    I am never going to use it again (I used to be a happy customer for years).
    Now I have the strong feeling they are close to exit in a nasty way.

    Reply

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