Coinbase started offering cryptocurrency exchange and trading services in 2012. This regulated company has an excellent security record and has several features that make it one of the safest places to buy, sell, and trade crypto.
As well as adding new coins regularly, the platform has widened its operations to cover other jurisdictions other than the US. These include the UK, EU and Asia. This Coinbase review gives a detailed overview of the platform, including its history, supported payment methods, security and trading options.
Table of Contents
- 02 Pros & Cons
3 Steps to Sign Up to Coinbase
1. Register and Verify your ID: Create an account using your email. Click on ‘Get Started’ and in the popup window; enter your name and password. Accept Terms and Conditions and click ‘Create Account’. Confirm the email address and choose the account type as ‘individual’. Once done, set up 2FA by confirming your telephone number.
2. Make a Deposit: This is the next step before you proceed to buy cryptocurrencies. Go to the homepage and log in to your account. Set up a payment method and follow the guidelines to deposit funds via bank transfer, credit card, or PayPal.
3. Purchase your Crypto: Once you have funded your account, go to the ‘Buy Crypto’ page and select the digital asset you wish to purchase. Enter the payment option and confirm the details of the transaction. Finally, click the buy button to receive the crypto into your wallet.
Pros & Cons
Coinbase is a top cryptocurrency exchange that offers a wide range of crypto trading products, with a solid claim as the best of US-based crypto companies. There are some aspects of the platform though, that may have you question whether or not it is right for you. Perhaps you are looking to invest in a cryptocurrency that is unavailable through Coinbase, or feel that you can pay fewer fees.
If you want to compare the platform with other exchanges, we have prepared a short list of recommendations.
History of Coinbase
Coinbase was started in June 2012 by Brian Armstrong and Fred Ehrsam and has continued to offer crypto services to a growing base of users since. The company has its head offices in San Francisco, California, USA.
Since its launch, the company has grown its core team and expanded its offering from just four coins to over 100. The platform has, over the years, received funding from several top investors, with over $500 million raised at the time of writing.
Apart from being regulated in the US, the exchange has licenses to operate in several countries across Europe.
In 2015, it became the first company to offer a regulated crypto exchange in the United States. Its customer base has increased tremendously to reach over 35 million worldwide, with over $220 billion worth of trades executed on the exchange.
Initially accessible only on the web, the exchange released its mobile app in 2017 to see it hit top spot as the most downloaded app on Apple Store.
Regulation and Security
Coinbase is a registered and fully regulated company based in the US. The exchange is one of the few that seek regulatory approval in every jurisdiction it operates. The platform holds several licenses, including the Money Services Business seal from FinCEN. It is also registered in several US states, holding money transmitter licenses including the BitLicense from the New York State Department of Financial Services.
It complies with the Bank Secrecy Act that sees its demand for KYC and AML compliance from its users. It also adheres to consumer protection laws like the USA Patriot Act that ensure that the exchange and its customer base comply with all applicable laws.
On the international scene, Coinbase has regulatory approval in the UK and the EU, with the team continuously applying for and obtaining licenses in every jurisdiction it seeks to operate.
For example, the company's subsidiary CB Payments Limited has approval from the UK's Financial Conduct Authority (FCA) to engage in the issuance of electronic money.
As one of the most well-established cryptocurrency exchanges, it has earned a name for itself as one of the most secure. The reason isn't just its regulatory status in the US. It has attracted a huge base of investors and backers, including names like Andreessen Horowitz, Blockchain Capital, and the Bank of Tokyo.
Other than that, the safety of user funds is one of the biggest pluses for Coinbase. The company holds customer funds in custodial banks, separate from company money.
In addition, the exchange stores 98 percent of their customers' crypto assets in cold storage, including vaults and safety deposit boxes. Funds left in online wallets benefit from policy cover by Lloyd's of London, while FDIC covers US residents with insurance of up to $250,000.
Coinbase also has a website fully encrypted with Secure Sockets Layer (SSL) (https). AES-256 encryption protects customer wallets, while users bolster their security using 2FA. All these features mean that the exchange provides an environment with one of the highest security scores in the industry.
Is Coinbase Safe?
As a new user, you are likely to have come across advice that one of the first things to do before using an exchange is to find out as much as you can about its security or safety.
While the overall opinion is that you should treat every platform you use to buy, sell or trade crypto individually, it is reassuring to note that Coinbase is far too established and regulated to ever pull an exit scam. The reason it is considered one of the safest bets is its constant engagement with regulators from all jurisdictions it operates and the way it protects user funds is testament to how safe it is for users.
There are hundreds of cryptocurrency exchanges, and users need to be careful which platform they use. Reputation is one of the key factors to consider, and for anyone looking to use Coinbase, the same consideration applies.
As noted in our review of the platform's regulation and security, Coinbase is a highly regarded trading platform achieves an overall score of ‘excellent’ in terms of its reputation. It also ranks among the top platforms that offer real volume.
While its continued need for regulatory approval has seen it irk a few within the crypto space, its services are among the best available and users have often pointed to this aspect as the reason they hold accounts on the exchange.
Is Coinbase for Me?
Coinbase is available for both the newbie and the advanced trader. Features and platform functionality make it one of the first entry points into crypto buying. Let's see why this is the case:
I'm a Beginner
Most people who buy their first Bitcoin do it on Coinbase. The company offers a cool crypto buying and trading platform. Start with an easy signing up process and buy crypto, hold, or sell. You can also breeze through excellent crypto resources as you learn and earn. Do all these on the primary platform Coinbase.com.
If you are a pro, then Coinbase Pro has what you need. The platform formerly known as GDAX is the exchanges' dedicated interface for advanced traders. Use the intuitive interface to exploit a full range of trading options, including real-time order books and charting tools.
Exchange Wallets: Features, Supported Cryptocurrencies, and Security
Users have access to a built-in wallet app called Coinbase Wallet. Users control their private keys as this is a non-custodial wallet, meaning you have control over access to your coins as opposed to when the funds are held on an exchange.
The wallet supports both iOS and Android devices. Once you download the wallet, you have the option of linking it to your account to get easy access to crypto transfers from/into the app.
Coinbase initially offered only Bitcoin and added Ethereum, Litecoin and Bitcoin Cash. The four were the only available cryptocurrencies for a long time as the exchange did not want to list assets that could have later been classified as securities.
The past couple of years have, however, seen the exchange add support for a host of coins and ERC-20 tokens.
The number of cryptocurrencies available on both Coinbase.com and Coinbase Pro has increased significantly. Now you can buy, sell or trade BTC, ETH, LTC, BCH, ETC and a host of Ethereum-based tokens totalling over 100, including Chainlink, Algorand and most recently Band Protocol.
For the security of users on the platform, the company adheres to the Data Protection Act 2018 and the General Data Protection Regulation. What this means is that the company has an obligation to safeguard its users' personal data. If you end up signing up for the Coinbase card, your data is safe as the issuer Paysafe Financial is regulated by FCA.
How to Transfer Your Crypto Funds From/To Coinbase
You can easily send crypto from your Coinbase wallet to an external wallet. Simply go to your account and click on the Send tab. The next step is to select the crypto you want to transfer. Enter the amount, the receiving address and send.
If you want to transfer crypto from an external wallet to your Coinbase account, go to the Accounts tab and select the wallet to send funds to and press ‘Receive’. Use the wallet address provided to transfer crypto to your Coinbase account.
Fees and Costs
Coinbase offers some of the most competitive fees in the crypto exchange space. The costs vary though and some competitors may offer lower fees.
Deposit and Withdrawal Fees
Fees range from 1.49% to 3.99%, with the costs varying according to the payment method used. Credit card costs are the highest but are generally within the industry average.
Fees for crypto trading are generally charged on two bases: a spread fee of 0.5% for fiat-to-crypto purchases and sales and a 1% flat fee for crypto-to-crypto trades.
Payment Methods & Limits
The exchange supports several payment methods; with its offering of local currency payments one of the great reasons people favour the platform. Note however that support for some of the payment options is not universal. There are restrictions and it is good to find out what payment method is allowed in your country or location.
- Bank deposit
- Debit card
- Credit card
Fees associated with these payment options may vary.
Coinbase offers some of the highest limits in the industry if an account is verified. Unverified accounts get very low limits. US residents have up to $50,000 in daily BTC purchases, while those in the EU have a daily limit of up to €30,000.
Performance, Features, and Functionality
Coinbase has several features that make it the best entry point into cryptocurrency. Here is a review of its performance, features and functionality.
The Coinbase trading platform offers a very simple dashboard that any user can use to effectively monitor their coins.
The exchange has ensured that the interface is intuitive but at the same time, extremely easy for traders to buy and sell cryptocurrencies. The price alert feature allows you to be on top of any movement in price around your targets.
The platform features a fast and convenient trading interface, with a 24/7 support team making it easier for users to find help.
Additionally, the exchange has had very minimal, if at all, disruptions to its trading platform. Although heavy traffic has in the past led to delays, quick action by the team has meant users have not experienced a lot of missed opportunities.
Other features of the trading platform that make it a great site are:
- Fiat support: It offers support for the major fiat currencies USD, GBP and EUR.
- Multi-platform support: Access Coinbase online/web, mobile app.
- Instant Exchange: Simply pay in crypto and get fiat or vice versa at no extra cost.
- Coinbase Card: The card allows you to spend crypto directly from your Coinbase wallet account.
- Register on Coinbase.com and access the account on Coinbase Pro: If you want to seamlessly switch to trading, navigate to the Coinbase Pro page and have your main account there with you. As such, you don't need to have another account to use the professional traders' platform.
One of the reasons it is good for beginners is its extensive offering of educational resources aimed at helping customers master the basics of cryptocurrency and trading.
What’s more, these resources are available for free. The Coinbase Earn program allows users to earn as they learn about crypto. It complements the Coinbase learn offering that helps anyone new to the space get the answers they need to benefit from the exchange's services.
The exchange also runs a blog that offers news and crypto-related information, while one can get valuable ideas from its FAQ page.
Coinbase does not offer margin trading or futures contracts. Users can access spot trading on Coinbase Pro and high liquidity buys using the institutionally-oriented Coinbase Prime.
You get the following from the platform:
Coinbase allows its users to hold and trade USD Coin (USDC), which is an Ethereum-based ‘stablecoin’ whose value is pegged 1:1 to the US dollar. Users can thus buy and hold the token or redeem it for USD.
This is a service that provides crypto custody services targeted at institutional investors. Clients pay $100,000 as set up and need to hold a minimum of $10 million.
Instant Bank Purchase
It allows its users in the UK to link their bank accounts and access instant crypto purchases. It has meant that users can deposit or withdraw directly from/to their bank accounts- ultimately adding speed and efficiency to the process.
The exchange offers the ‘Coinbase Bundle’ as a basket of the five top digital assets on the exchange - Bitcoin, Ethereum, Litecoin, Bitcoin Cash and Ethereum Classic.
Coinbase offers staking services where users can earn interest by simply holding or delegating them for use in blockchain governance. Currently, Tezos (XTZ) is the only PoS coin offered in the staking program, although it is looking to add more coins in the near future.
Coinbase OTC desk
The Coinbase OTC trading desk is vertically-integrated with the exchange's Custody service, allowing institutional buyers instant access to large volumes of crypto anonymously. To use the platform, customers need to complete a mandatory AML/KYC process.
Other features of the OTC desk include access to liquidity offline and availability through agency-only arrangements.
To ensure customer protection and safety of funds, the exchange holds over 98% of funds offline and in cold wallets. What this means is that should there be an unfortunate case of a hacking, most of the user funds will be safe. Insurance provides cover for the small amounts of crypto stored online/hot wallets.
Coinbase offers two types of accounts for its users: an individual account and a business account. Users specify the type of account when registering. For users who want to trade on Coinbase Pro, you don't need to sign up for a new account.
No cryptocurrency exchange can be said to be perfect, not even the highly regulated Coinbase. However, as far as comparisons go, it has been and remains one of the most user-friendly exchanges in the space, with its trading platform designed to give users an easy experience as they buy or trade the most popular digital assets. As far as its safety measures go, it is arguably the most secure of all crypto exchanges.
No matter what exchange you are using, avoid, as much as possible, keeping all or most of your crypto assets on exchange wallets. Always endeavour to transfer the coins to a wallet whose private keys are under your control. This is especially important for those who have a long-term strategy planned for their investment.
Yes, you can trade fiat-to-crypto and crypto-to-crypto pairs on the exchange and Coinbase Pro.
Yes, after you register you'll need to verify your ID and provide other verification documents.
No. For now, the company offers only spot trading. Other opportunities to earn on Coinbase include staking.
Yes. It is a legit company with relevant registration and licenses in all countries it operates.