Coinbase is one of the most popular cryptocurrency exchanges in the world, only coming second to Binance based on Web Traffic Factor by CoinMarketCap. Based in San Francisco, Coinbase provides a gateway into cryptoverse for millions of crypto enthusiasts in the United States and abroad.
Coinbase operates in a little over 100 countries. Users have access to 93 markets, the bulk of which is Bitcoin.
The exchange has grown hugely popular over the past five years, a period during which it underwent major changes aimed at serving the platform’s clients better.
Coinbase Review – Overview
Coinbase is among the most secure crypto trading exchanges in the world. The platform operates in 102 countries where users can convert and trade their digital assets. Coinbase lists 3,552 cryptocurrencies, with 30 most popular coins being tradeable. The exchange is regulated by the SEC, ASIC, FCA, and many other reputable regulators across the globe.
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What is Coinbase?
Brian Armstrong and Fred Ehrsam founded Coinbase, Inc. in June 2012, which is the parent company of the exchange. The company was incubated in Y Combinator’s startup school, which is also responsible for notable names like Airbnb, Twitch, and Dropbox, among others.
Coinbase boasts many achievements, but the most significant is that it was the first regulatory-compliant crypto exchange in North America. Coupled with an easy to use graphical user interface (GUI) and competitive transaction fees, Coinbase immediately shot to the top of rankings for crypto exchanges not just in the United States but in several countries around the world as well.
Because of its popularity, Coinbase attracted the attention of notable venture capital firms including Ribbit Capital, Andreessen Horowitz, and the NYSE, among others. These VCs have since helped Coinbase to raise funds in the region of $540 million.
Today, cryptocurrency traders in 102 countries can use Coinbase for purchasing cryptocurrency, as well as trading digital coins for fiat currency. Coinbase offers a wide range of crypto assets for conversion and trading.
The cryptocurrency trading option is available to just a handful of countries, the majority of which are located throughout Europe. Although Coinbase services clients in Africa, traders from the continent can only use the exchange to convert digital currency to fiat or vice versa, and digital currency to digital currency.
Coinbase is also involved in the development and support of a stablecoin called USD Coin (USDC). Coinbase is part of a consortium called Centre, which also includes Circle, that is responsible for developing USDC. While the Centre created the core technology and governing framework for USDC, Coinbase and Circle issued the coins to cryptoverse.
How Does Coinbase Work?
Coinbase has the strictest guidelines as far as onboarding new users are concerned. The KYC (Know Your Customer) process begins at the first instance when you begin registering for an account. Before you can go ahead with account creation, you must first confirm that you are at least 18 years of age.
Next, Coinbase demands that you verify the email address you supplied. After that, you must provide your phone number that the platform can verify. In short, your details must be tested before you to are granted access to Coinbase.
A regular Coinbase account does not undergo as much scrutiny as the advanced accounts because of the smaller amount of money involved. For Coinbase Pro and Coinbase Prime, new users must satisfy not only KYC measures, but also AML (Anti-money Laundering) guidelines. To set up such an account, users must supply additional information such as bank statements among other relevant pieces of information.
Coinbase accepts deposits either in the form of fiat or digital currency. You can load Bitcoin (BTC) to your Coinbase account or simply link your own private wallet. Alternatively, you can load fiat currency in your Coinbase e-money wallet, which can then be used to buy the desired digital currency.
Coinbase regular accounts come in two levels. A Level 1 account is that which the user has verified the name, the email address, and has accepted the platform’s terms of service. With this account, you can only send and receive cryptocurrency.
A Level 2 account means users have verified their personal information like age, country of residence, and they have provided a clear photo of a government-provided ID. This account provides access to trading digital currencies.
Key Services & Additional Features
Coinbase divides its products into three categories. There is ‘Coinbase For Everyone’, ‘Coinbase Pro’, and ‘Coinbase For Businesses’. Coinbase For Everyone is a product targeted at retail traders who are mostly beginners.
When you register for a regular account, Coinbase offers you cryptocurrency conversion and trading services. But remember that the trading feature is supported in just a handful of countries in which Coinbase operates. Also accessible with a regular beginner account are Coinbase wallets for e-money and digital currency, USDC, and a chance to earn fiat money through learning about cryptocurrency.
The Coinbase Pro account is ideal for advanced crypto traders. Coinbase Pro account holders engage in buying and selling cryptocurrency in a secure and insured environment. This account is only open to individual traders. For institutional traders, there is Coinbase Prime. Coinbase Prime offers the convenience and safety of Coinbase Pro but in a way that suits institutional crypto traders.
Coinbase For Businesses is a unique concept where Coinbase goes above and beyond merely acting as an exchange. In this category, Coinbase offers crypto custody services for businesses, as well as a platform for crypto start-ups to raise money for their projects. Additionally, Coinbase facilitates commerce by enabling businesses to accept crypto payments. Effectively, this product category is a bridge between the new and old financial ecosystems.
What Cryptocurrencies are listed on Coinbase?
Coinbase offers 93 markets, and you will find all the major coins listed. At the moment, Coinbase lists 3,556 crypto assets, with 30 actively tradeable. They include:
Basic Attention Token (BAT)
… and 23 more.
Find the complete list here.
Supported Countries, Currencies and Payment Methods
Coinbase is available in 102 countries across six continents, that is North and South America, Europe, Asia, Australia and Africa. Some key supported countries include:
The United States
The United Kingdom
… and more.
Find a comprehensive list of supported countries here.
Coinbase supports fiat currencies from all the supported countries. For instance, a user in Hong Kong will transact in Hong Kong Dollars (HKD) while a user in South Africa can transact in Rands (ZAR).
When it comes to payment methods, Coinbase accepts various options depending on your location. For US customers, payment methods are:
Bank account (ACH)
For customers in Europe, the payment methods are:
3D secure card
Debit card (only for withdrawals)
PayPal (only for withdrawals)
The Coinbase app
With this app, you can safely have your Coinbase wallet in your mobile. You will be able to send or request bitcoins, buy and sell bitcoins, access your wallets, the safety deposit box and view the details of your transactions.
Use: it's like having a wallet from Bitcoin, Ethereum, and Liteco, all in one.
Security: You can set a password to protect access to the app and lock it if you lose your mobile or it gets stolen.
How to buy Cryptocurrency on Coinbase
Coinbase users can buy cryptocurrency in five easy steps:
1Log into your account and go to the ‘Trade’ tab (ensure your account is funded).
2Select the crypto asset you would like to buy and specify the amount.
3Enter the address of the wallet in which you wish to store the crypto assets.
4Specify the payment method to be used.
5Confirm the details of the order and click ‘Buy’.
Coinbase Fees and Limits
Coinbase charges a range of fees based on the account type and the service rendered. For regular account holders, Coinbase does not charge for wallet service. Coinbase charges trading fees of 0.50% for buying and selling of cryptocurrencies.
However, the purchase fee might change depending on the payment method used and the location of the buyer. Debit card buys across all countries attract a fee of $3.99, but credit cards are only allowed for users in Australia (which attracts the same fee amount).
For credit transactions, i.e. borrowing USD from Coinbase, the platform charges a flat fee of 2%. The same fee amount is charged for cryptocurrency conversion.
For US-based customers, the base rate for all transactions is 4%, except that deposits are free of charge unless done via wire transfer.
Coinbase supports staking services, where customers can stake their crypto assets in a proof-of-stake network belonging to third parties. To cater for the services, Coinbase takes a commission of 25% from the stake’s earnings and gives the rest to the customer.
Coinbase Pro users incur trading fees based on whether they are takers or makers, and also depending on the trading volume. On Coinbase, you are a taker if you place an order at the market price and the broker fills the order immediately. In other words, a taker ‘takes’ the price that is available at the time of placing an order.
On the other hand, a maker is a trader whose order placed at the market price fails to be filled immediately. Instead, Coinbase places the order on the order book to wait for a matching order from other users. When a matching order finally arrives and your order is filled, you are said to have ‘made’ the order. Takers pay between 0.04% and 0.50% in trading fees while makers’ trading fees range from 0.00% to 0.50%.
Custody fees are charged on a monthly basis, but when annualised, they amount to about 50 basis points of the amount in custody. Depending on use, the implementation fee for custody range from $0 to $10,000.
When it comes to limits, deposits to the Coinbase Pro account are unlimited as long as they are in digital assets. Wire transfers in US dollars are also unlimited when depositing. However, depositing via SEPA/ACH is limited though the limit varies.
Further, Coinbase Pro and regular Coinbase account owners cannot withdraw more than $25k per day. This is true whether the withdrawal is done in fiat currencies or in digital assets. However, you can be considered for higher withdrawal limits if you meet certain conditions like providing more personal details such as proof of residence.
Is Coinbase Safe?
Coinbase is one of the safest cryptocurrency trading platforms in cryptoverse. Because the exchange started off with robust security measures in place, it has never experienced a successful hack.
Security begins at the account opening stage, especially for Coinbase Pro customers. New users must provide documents supporting the supplied personal details for KYC processing. The documents required for this process include government-issued IDs and proof of residence. Without the KYC verification, you cannot access any of Coinbase’s services.
In addition, all users might set up two-factor authentication (2FA) for their accounts. Coinbase accepts third party 2FA applications but only the ones that are proven in the industry.
Another layer of security that Coinbase implements is ensuring that 98% of client funds are in cold storage wallets. Further, all Coinbase accounts are insured by the FDIC.
Other layers of security include encryption of website traffic, encryption of customer keys and wallets using AES-256 mechanism, and regular criminal checks on all Coinbase employees. In this light, we are confident that Coinbase is a safe platform for your crypto trading activities.
Is Coinbase Legit & Regulated?
Coinbase, Inc. is the parent company of the Coinbase Exchange. It has operating licenses across all US states and all countries in which it services users. This means Coinbase is under the regulatory jurisdiction of top financial regulators such as the US Securities and Exchange Commission (SEC), the UK Financial Conduct Authority (FCA), and the Australian Prudential Regulatory Authority (APRA), among others.
In terms of legitimacy, Coinbase operates according to the best standards established in the US and elsewhere. Its customer support is excellent, with active phone lines and email addresses manned by a friendly customer service around the clock.
The fact that FDIC accepted to insure Coinbase means that the federal entity is satisfied with the authenticity of Coinbase’s business. In short, Coinbase checks all the important boxes concerning authenticity.
Coinbase Vs. Other Exchanges
Coinbase might be the most widely known and used cryptocurrency exchange, especially in the West, but the field is almost crowded. There are a few other crypto exchanges that offer great services. These match Coinbase on many levels, and their service quality is highly recommendable.
Coinbase ranks high among the best cryptocurrency exchanges. The platform has enabled millions of people to dabble in crypto trading while enjoying the safety and service quality reminiscent of the legacy financial industry.
Experienced traders find Coinbase Pro the go-to platform because of the wide range of service, including account insurance. In addition, the trading platform has a mobile phone app to facilitate trading on the go.
Because Coinbase offers the best trading services and security in cryptoverse, it is understandable why their fees are slightly higher than those for average cryptocurrency exchanges. While cryptocurrency trading and investment carries some inherent risks, Coinbase informs users as much as possible to help ensure that these are carefully considered.
Frequently Asked Questions
Coinbase offers two major services, which are cryptocurrency conversion and cryptocurrency trading. The crypto conversion feature is available in all 102 countries that Coinbase supports. However, crypto trading is accessible in select countries, most of which are in Europe. In Africa, for example, Coinbase does not support crypto trading in any of the supported countries.
It depends on your trading experience and the amount of money you are willing to commit. For beginners, the regular Coinbase account is ideal. The registration process is simple and fast, and customers can access a wide range of Coinbase services. In addition, the risk level to which regular users are exposed is small. However, advanced traders can open a Coinbase Pro account that offers advanced crypto trading services.
No. Registering for all accounts, except the institutional version, is free of charge. The only time you will need to spend money is when funding your Coinbase wallet to start trading.
Yes. All Level 1 accounts (whether they are regular or Coinbase Pro) have a withdrawal limit of $25,000. However, customers are free to increase this limit by providing and verifying further information. Required information includes a photo of a valid government ID, as well as proof of residence. Technically, your account will become Level 2 after the verification of details.
Yes. Coinbase is one of the safest, if not the safest, crypto trading platform in the industry. The exchange has in place robust security measures whose implementation begins at the account registration phase. Additional security layers include encryption of web traffic, implementation of 2FA, and cold storage of 98% of customers’ digital assets.