In short
- Coinbase is one of the largest and best known digital currency exchanges in the world.
- It is an accessible ramp for newcomers to the cryptocurrency space, but its fees are higher than competitive exchange fees.
- It offers a number of additional services including the Coinbase Wallet app, Coinbase Pro and Coinbase Card.
What is Coinbase?
Coinbase is one of the largest and best known digital currency exchanges in the world. It is widely regarded as one of the most accessible as well, as it allows consumers to buy crypto using fiat currency.
Established in San Francisco in 2012, Coinbase currently has over $ 20 billion in assets with crypto worth over $ 50 billion traded to date. In addition to its regular exchange the company also has a professional trading platform called Coinbase Pro (formerly known as GDAX).
Design and UX
The look and feel of a crypto exchange may seem strange to focus on, but swapping with complex or confusing interfaces can be scary enough that you’ll actually feel nervous about making costly errors.
Thankfully, Coinbase has an extremely clean, easy-to-use interface that is clutter-free and a breeze to navigate. Its dashboard shows you all the key information you are likely to need at a glance such as your portfolio holdings, price charts and recent activity, with easy access to trading features, tools and account settings on the side.
All in all, the Coinbase interface is one of the main reasons besides fiat purchase support which makes it a solid choice for crypto newcomers.
Get started
Getting started with Coinbase is a simple experience. Naturally, you start by signing in with your name and email address, while also setting up a password. After verifying your address, you will need to provide your phone number to receive a verification code, which you must then enter to proceed. These check codes can then be sent to the same number in the future for a more secure login.
The next step may seem daunting to newcomers as it involves proving your identification by providing a state ID. In the US, that means you will have to share your social security number.
Make sure this is a normal process just like opening any bank or investment account. Once that’s all done, congratulations – you’re the owner of your own Coinbase account.
Ease of use
The next step is to add your bank account, credit, or debit card information to enable you to make deposits and withdrawals, for trading and / or investing. Again, this process is very easy and intuitive, and should not cause any problems.
You can add your bank account by opening your ‘Payment Methods’ page, selecting ‘Connect New Account’, and selecting ‘Bank Account’. Choose your bank, fill in your login credentials, and boom – your bank account is now linked to Coinbase. Adding a debit card is just as easy – choose to add a debit card, fill in the information, and you’re good to go. Please note that credit cards are no longer supported.
Once you have been sorted on the front of the bank / card account, you can go to the ‘Buy’ section, browse for the crypto you want to buy, select your preferred payment method, confirm the details, and hit ‘Buy now’.
Each purchase will be charged a transaction fee (which is outlined in detail here), which may be higher than other exchanges. If you bought $ 100 from Bitcoin, for example, your youtube fee will be $ 2.99. Given how easy Coinbase is to use and set up, beginners who have yet to expand their trading experience might find this an acceptable cost.
Selling is just as easy. Just select the ‘Trade’ button, hit ‘Sell’, select the crypto you want to sell, and sell it to your USD wallet. Select the wallet, select ‘Withdraw’ and you can swap the money into your account as well.
Is Coinbase safe?
Security is never 100% guaranteed, but as crypto exchanges go, Coinbase is one of the safest options out there. It is the world’s largest Bitcoin exchange and broker and is backed by trusted investors. The fact that it is located in San Francisco (a highly regulated location) is another welcome bonus.
To date, the company has never experienced a hack, which is an impressive record to say the least. Part of this robust security record is due to the fact that 98 percent of customer funds are stored offline in cold storage (aka disconnected from the Internet), protecting them from unsuspecting thieves online procurement. In addition, paper drives and backups are distributed geographically in secure deposit boxes and vaults throughout the world.
Having said all that it is worth noting that cash held in Coinbase wallets Insured FDIC up to $ 250,000. However, crypto is not insured, so unless you plan on day trading, always store your coins in an appropriate place wallet after purchase.
Is Coinbase good for privacy?
Although highly praised for security, Coinbase’s privacy history is less impressive for those people who wish to embrace the anonymous aspect of crypto.
There is no shortage of reports claiming Coinbase is tracking how its users spend Bitcoin, and the acquisition of Neutrino – a blockchain-based startup tracker – has done little to change privacy advocates’ minds.
Neutrino is a company focused on analyzing blockchains with the aim of revealing the identity of address owners. Along with the news Coinbase wants to make selling its blockchain analytics software to the DEA and the IRS, it’s clear to see why privacy alarm bells sings (very loudly).
Coinbase wallet
Coinbase Wallet is a standalone cryptocurrency wallet for iOS and Android that anyone can download, regardless of whether it has a Coinbase exchange account or not. It is an alternative to others mobile wallet apps which lets you store crypto, and the private key to your funds is held on the smartphone itself, putting you in complete control of your funds (unlike storing coins on an exchange) .
Like the exchange, the Coinbase Wallet is easy and clear to use, letting you store, send and receive things like Bitcoin, Ether, Ripple, ERC20 tokens and more, with the ability to back up your private keys to the cloud if you accidentally lost your recovery phrase. If you happen to have a Coinbase account then you also have the option to connect it to your wallet to access your funds there.
Coinbase Pro
Coinbase Pro is Coinbase’s alternative exchange aimed at more experienced consumers with more trading options. Despite being a separate exchange, consumers can still transfer money between their regular accounts and Coinbase Pro.
Additionally, Coinbase Pro actually offers lower fees than the regular Coinbase exchange while providing more options, albeit at the cost of a more intrusive interface.
Although Coinbase is simplistic in nature, Coinbase Pro has more mechanics in buying and selling, letting you choose your own market prices. This allows you, for example, to set a purchase price below the higher and higher Coinbase rate in line with the rest of the market, initially with lower fees.
If you really want to sell without spending a bit of time setting up your buy and sell orders in this way, you can always choose to sell at the market price, although that offers the same experience as the regular Coinbase exchange.
Long story short? You’ll get a better deal using Coinbase Pro. Don’t be fooled by the fancy interface and graphs that have little to no part in simple straightforward transactions, although they are intimidating at first.
Coinbase card
Coinbase also offers UK and European residents the ability to sign up for the Coinbase Card, a Visa Debit card linked to your Coinbase account. The card allows you to spend any cryptocurrency stored in your Coinbase account, automatically converting crypto into fiat currency at the time of payment.
Currently, you can use the card to buy things in store and online using any of the cryptocurrencies stored in your Coinbase wallet, initially with non-contact payments and Google Pay (though not Apple Pay) support . With the option to earn 4 percent back in XLM or 1% back in BTC.
Thanks to its high fees though, we’d say this card is more of a novelty for the time being, and should be treated as a simple way to show people the potential of wider crypto adoption. US residents can registration time Coinbase card waiting list, with the first customers due to be approved this winter.
Verdict
Coinbase is the world’s largest crypto exchange for a reason. It offers a very simple fiat entry point into the world of crypto trading, complemented by a simple interface and registration process, not to mention an incredible security history. The price for this convenience, however, is a gray area that surrounds its privacy practices, not to mention some of the highest transaction fees around it.
For us, Coinbase remains a solid exchange that we would recommend crypto first-timers looking to dip to buy, hold and sell. However, once you’ve gained some experience, it’s worth exploring some of the other options available, such as Gemini, Kraken and Binance.
Star rating: 4/5