Coinbase was started in June 2012, a crypto service company based in San Francisco. A digital currency platform and wallet, Coinbase allows users to trade virtual currencies like Ethereum, Bitcoin and Litecoin. With a Bitcoin bias based on the coin’s current fame and total market cap in excess of $100 billion, Coinbase’s growth has accompanied that of the cryptocurrency.
Serving investors in more than 30 countries, Coinbase is essentially the world’s largest bitcoin broker. Users can purchase bitcoin by connecting their bank account, and the company has mandatory disclosure as a basic tenet of its account holder’s structure. While PayPal is not an acceptable method of payment, a user can cash out by paying their PayPal account from their Coinbase wallet.
Most legacy payment methods are accepted when buying bitcoin on the exchange, and Coinbase also trades other digital currencies and accepts other fiat currencies besides USD.
That said, the values expressed and overall sentiment is very much a bitcoin/USD environment among users. With an almost “banky” feel to it, the brokerage asks that users provide many personal details and full ID verification. Credit card purchases need to be accompanied by photos of the card employed.
Coinbase Growing Through Fintech Services
Anyone looking to buy and trade altcoins will need a fairly sophisticated platform that enables trading, and also a messaging service that deploys data to the blockchain to enable verification. While Coinbase seems to lack the dynamism and frenetic trading facilitation of many other exchanges, it has a few cornerstones of value that have made it such a popular venue. In a nutshell, Coinbase allows people to buy and sell bitcoin and other altcoins using USD and other fiats. It also acts as a wallet for all transactions.
While these two points might sound simplistic in the modern era of increasingly connected and complex exchanges, the offer has found solid patronage since inception. The Coinbase decentralized asset exchange serves as a venue where users buy and sell digital currencies, as well as serving as a wallet facility for users.
Whereas even a year ago figures were still almost conventional, current exchange figures show much larger volumes moving. To date, Coinbase has serviced the needs of over 10 million people and exchanged over $50 billion in virtual currencies.
With top-tier security protocols at play, the company is hypersensitive to the prospect of hackers attacking the exchange. This focus is compulsory, not only in terms of mandated fiduciary duty, but also in an era witnessing the emergence of exchanges that use either majority cold-vault their holdings or demand that users maintain their own wallets in order to eliminate the risk. In line with current legislation, the company is licensed by all relevant authorities. At least in terms of professional presentation, the portal is polished and a joy to use.
Having investigated every angle and potential of every transaction possible on site, the development team have included a host of FAQs and other intel to guide newcomers. No user employing a credit card to buy bitcoin, for example, should become liable for a cash advance fee, and support is prompt in resolving issues flagged by users.
At the outset, Coinbase resisted the temptation to be all things to all people, while also positioning themselves as a very respectable digital exchange, of necessity copying many banking protocols.
Controlling all private keys, the company presents more like a bank in this arena than a typical crypto-wallet. A Coinbase wallet is accessed via the web or their proprietary apps.
How Does Coinbase Compare?
A reputable company backed by reputable investors, Coinbase is arguably the “world’s largest bitcoin broker.” With wallet facilities of various hues, including a Multi-signature Vault, it’s clear the company wants to run ahead of attacks with a constantly evolving security focus. Broad industry sentiment seems to approve currently of storing all cryptocurrencies in a personal, cold wallet for safekeeping, and most users of the site transact in this manner.
Users should read through the company wallet options carefully in order to maintain the kind of control they enjoy over their bitcoin. Employing a Coinbase wallet means that the company is in control and this will only appeal to those who trust the security protocols wholly. A brokerage, exchange and wallet, Coinbase’s developer API is also a popular component of the project for many users.
Exchange fees on Coinbase hover around 3.75 percent of the trade, with country differences and order volume also impacting those fees.
Additionally, the company does offer high account limits. Based on “account level” (a metric determined by how much information an account holder has supplied in establishing their account), verified U.S. citizens can buy a maximum of $50,000 worth of bitcoin each day. For European customers, a maximum of €30,000 euro may be held in their accounts.
The time users need to wait after a transaction before bought altcoins become spendable varies. Depending on country and payment method, funds can be quickly available or sometimes take days to land. Enjoying possibly the fastest settlement, when a fully verified U.S. citizen buys bitcoin, for example, using a debit/credit card, the altcoins are instantly available once the card has been authorized.
Although very much an American company, U.S. bank transfer users can still expect to receive their bought altcoins only five business days after placing the order. And yet although one might imagine foreign clients to experience even greater delays, the Coinbase global offer at least equates standard banking practice – a known experience with known time frames – even for foreign users.
Shaving waiting time whenever it’s enabled by blockchain technology, users have rubber-stamped the company as a suitable balance of legacy practices.
Adding a credit card to a user’s account will enable the “Instant Buy” facility. This allows verified buyers to purchase a maximum of $1,000 in bitcoin each week. Although there have been past reports of the company tracking how exchange users spend their bitcoin, it appears to have been more a case of honest analytics becoming too exuberant rather than anything spurious.
Newcomers especially will find the simple, elegant offering on Coinbase easy to use and reassuringly riddled with security protocols. Although vault withdrawals can take up to 48 hours, even this delay is a safety net to avoid corrupt transactions. Any vault client noticing an unauthorized withdrawal in progress can cancel the transaction.
Governed as it is by KYC legislation, due to its buy/sell nature, the company is AML-heavy, overcompensating in the opinions of some commentators. Coinbase scored just 11 out of 100 in the Open Bitcoin Privacy Project’s 2015 Spring report.
Valued by some and detested by others for compromising innate blockchain anonymity, the company has nonetheless managed to gather all parties as best they could under prevailing regulation, and presented an intelligent platform for newcomers and experienced traders alike.
As Coinbase offers fiat “onramps” (the ability to buy digital currencies with fiat currencies), it is valued as a simple, logical route by many to swap out fiat for transactional cryptocurrencies.
Although users can find lower fees and faster transaction times on some other exchanges – although often not together – Coinbase’s following is loyal and seems dedicated to the current facilities the company offers. Overall satisfaction levels appear consistently high, notwithstanding a fair amount of social media griping, often around issues of transaction times and fees.