Updated: Apr 10, 2020
Cryptocurrencies have witnessed a huge surge in 2019, which is expected to grow through 2020. With an increasing number of promising opportunities, it has become even more important to choose a safe and secure exchange to facilitate your transaction. Coinbase is one of the most popular exchanges among beginners and pros alike.
This quick guide will touch upon the pros and cons of Coinbase while detailing its background, trading fee, funding options, and other features.
Why Should Beginners Choose Coinbase?
High buying limits
New users can purchase Bitcoins easily
Instant buy feature with credit card backup
Wide variety of deposit and withdrawal options
What’s not to like?
Accounts can be monitored
Less supported cryptocurrencies
Highly commercial and business-oriented
Brief Background of Coinbase
Coinbase is based out of San Francisco and was launched in 2012. It operates in 32 countries and has served over 12 million customers with a cumulative exchange value of $40 billion in cryptocurrencies, primarily led by the US. The original founding team of Coinbase comprised of Brian Armstrong, Fred Ehrsam, and Ben Reeves (co-founder of Blockchain.info).
Coinbase was the highest Bitcoin funded startup in 2013 and one of the largest cryptocurrency exchanges. It offers the unique feature of trading crypto at set prices based on market value. This allows users to acquire their cryptocurrencies at a much faster pace as compared to other exchanges.
What is the Trading Fees on Coinbase?
Currently, Coinbase charges fees ranging from 1.49% to 3.99%. This significantly depends on the payment method employed. For instance, credit card transactions would result in a higher fee. That being said, Coinbase trading fees are still lower than its direct competitors operating on a similar model, such as CEX and Coinmama.
Funding options and Limits on Binance US?
You would have to provide a preferred payment method before you can purchase cryptocurrency on Coinbase. Typically, there are three payment options on offer:
Debit cards have a much lower purchase limit as compared to other payment types. They also incur a high fee of 4%. The payment processor of Coinbase is run through the United Kingdom, even though the exchange is headquartered in the US. This means that your card may get charged with an additional foreign purchase fee.
Bank accounts are recommended for larger purchases. The only drawback is that they take up to 4 – 5 business days to complete a transaction. However, on the good side, the price is locked immediately when you purchase.
You may make a small profit if the digital currency you purchase increases in value as compared to the fiat during this period. But, if the currency you purchase increases in value, you won’t be able to sell it and instead lose money.
Nonetheless, a major advantage of selecting bank accounts as the preferred mode of payment is the higher limits. You can get started at $7,500 per week at a low fee of 1.5%.
U.S. customers also have the option to add a Visa or MasterCard credit card to speed up bank payments. The credit information shall be used as a backup payment method. The limit for credit card purchases is set at $1,000 worth of Bitcoins per week.
Coinbase offers some of the best limits in the crypto space. As a fully verified U.S. customer, you can purchase up to $50,000 worth of Bitcoins daily.
Is Coinbase Versatile in Terms of Trading
You can only purchase Ethereum, Bitcoin, Bitcoin Cash, and Litecoin on Coinbase right now. This is because where ‘hard fork’ cryptocurrencies, such as Bitcoin Gold is concerned Coinbase has stated that support shall be extended only when there is a guarantee in respect of security.
Although, there are plans to add more digital currencies in the future.
How User-Friendly is Coinbase?
Coinbase is the perfect platform for beginners. It is user-friendly and allows immediate purchase or sale of cryptocurrencies. It takes only a few minutes to signup, upload funds to the exchange, and make your first Bitcoin or cryptocurrency purchase!
Coinbase Customer Service
The exchange offers multiple modes of customer service. You can skim through the Knowledge Base and FAQs page available for customers. Coinbase also offers email customer support. Typical response time is within 24 – 72 hours, although, the wait time may extend. Many users have expressed frustration over “canned responses” that did not address the issue.
The Bottom Line
Coinbase, although not perfect, offers newcomers a practical and easy-to-use service for trading in digital currency. This cheap, popular, and convenient trading platform is more for beginners than advanced Bitcoiners.
It is recommended that you transfer your cryptocurrency purchase immediately to a personal wallet, like Trezor or Ledger despite the high-security levels offered by Coinbase. This will give you full access to the private keys of your holding.