Coinbase: The Ultimate Investment And Trading Companion

Coinbase is a cryptocurrency exchange platform that allows users to buy, sell, hold, send and receive cryptocurrencies such as Bitcoin, Ethereum and Solana. It is one of the largest and most popular crypto exchanges, with tens of millions of users. Coinbase is ideal for beginners, with an intuitive and user-friendly interface, and offers a wide range of cryptocurrencies to choose from. The platform also provides advanced features for more experienced traders, such as Coinbase Advanced Trade, which offers more trading options and upgraded charting functions.

Coinbase's fees are often criticised for being confusing and higher than competitors, and the company has faced legal issues with the SEC over unregistered securities. However, it remains a convenient and accessible platform for those looking to invest in or trade cryptocurrencies.

Coinbase's high fees and poor customer service

Coinbase is a cryptocurrency exchange that allows users to buy, sell, trade, and store cryptocurrencies and, more recently, NFTs. It is a popular platform for beginners and advanced users due to its user-friendly interface and extensive list of supported cryptocurrencies. However, Coinbase has received criticism for its high fees and poor customer service.

High Fees

Coinbase's fee structure can be complicated and confusing for beginners. The platform offers two main services: Coinbase and Coinbase Pro (now called Coinbase Advanced Trade), each with its own fee structure. While Coinbase does not charge fees for holding cryptocurrencies in your wallet, it does charge various fees for transactions, such as margin or spread fees, transaction fees, and advanced trade fees.

Margin or spread fees are included in the price when you buy or sell crypto and are also included in the exchange rate if you convert your crypto. Coinbase justifies this fee by stating that it temporarily locks in a price for trade execution while you review the transaction details. This fee applies to all cryptocurrency transactions on the Coinbase platform and when using the Coinbase Card.

Transaction fees, also known as Coinbase Fees, are based on multiple factors, including region, product, and payment method. These fees are not published by Coinbase but have been reported by third parties. For example, credit transactions incur a flat fee of 2% if you borrow USD from Coinbase or its affiliates. Additionally, using your Coinbase card at an ATM may result in operational fees.

Advanced Trade fees, suitable for more experienced traders, follow a maker/taker model. Makers create orders for other traders to take, adding liquidity to the market. Takers, on the other hand, remove liquidity from the market by taking orders created by makers. Makers pay lower fees, ranging from 0% to 0.4% of their transactions, while takers pay a higher percentage, ranging from 0.05% to 0.6%. These fees can be reduced based on trading volume and the user's tier.

It is worth noting that Coinbase offers a tier-based system, allowing users who trade with larger volumes to pay lower fees. Additionally, Coinbase allows users to adjust the network fee when making a transaction, with three options: Slow, Normal, and Fast. The "Slow" option is less expensive but takes longer for transaction confirmation, while the "Fast" option is the most expensive but provides the quickest confirmation.

Poor Customer Service

Coinbase has been criticized for its poor customer service, with users reporting non-human communication, slow response times, and a lack of urgency in resolving complaints. The available customer service options include a live chat function, a social media help platform, and a ticketing system, which are often more self-service than interactive.

On Trustpilot, Coinbase has received poor reviews, scoring 1.8 out of 5 stars from over 9,300 reviews. Users have expressed frustration with issues such as account freezes, difficulties with deposits and withdrawals, and unresponsive customer support. Similar sentiments can be found on Reddit, where users have shared their negative experiences with Coinbase's customer support, including difficulties in reaching human representatives and receiving canned responses from bots.

In summary, while Coinbase offers a user-friendly platform for investing and trading cryptocurrencies, it is important to be aware of its high fees and less-than-ideal customer service. Users should carefully consider these factors before deciding whether to use Coinbase for their crypto needs.

The ease of setting up a Coinbase account

Setting up a Coinbase account is a straightforward process. To get started, you will need to meet a few basic requirements. These include being at least 18 years old, having a government-issued photo ID (such as a driver's license), access to a computer or smartphone with an internet connection, and a phone number to receive SMS text messages. It is also recommended that you have the latest version of your internet browser (preferably Chrome) or the latest version of the Coinbase app.

Once you have everything you need, go to the Coinbase website (https://www.coinbase.com) or download the app on your Android or iOS device. It is not recommended to access Coinbase through a mobile browser. On the website, select the "Get started" option or use your Google account to sign in. If you choose to sign in with Google, follow the prompts to continue.

When creating your account, provide accurate and up-to-date information to avoid any issues. You will need to enter your legal full name, email address, and create a password. It is important to use your real name as shown on your government-issued ID, as using an alias could delay the confirmation of your identity later on. Double-check that your email address is correct, as you will receive important communications from Coinbase at this address. Choose a strong and unique password to keep your account secure.

After entering your information, you will need to read and accept the User Agreement and Privacy Policy. Coinbase may also send a verification email to your registered email address. Click on the link in this email to verify your email address.

The next step is to verify your phone number. Sign in to your Coinbase account and add your country and mobile number. Coinbase will send you a seven-digit code via SMS, which you will need to enter on the verification screen. This completes the initial setup of your Coinbase account.

From here, you will need to add your personal information, including the details from your government-issued photo ID. You will also need to answer some additional questions, such as what you will use Coinbase for and the source of your funds. This completes the application process, and you will receive further instructions via email.

To buy, sell, and send or receive cryptocurrency through Coinbase, you will need to verify your identity and add a bank account or other payment method. This involves submitting a photo of your government-issued ID and may take several days to complete. You can also set up two-step verification to add an extra layer of security to your account.

Coinbase does not charge a fee to create or maintain your account. However, there are fees associated with trading and transacting on the platform, which vary depending on your account type, transaction size, and funding source.

How to buy and sell cryptocurrency on Coinbase

Coinbase is a cryptocurrency exchange that allows users to buy, sell, transfer, and store digital assets like Bitcoin and Ethereum. The platform offers an intuitive online interface and a mobile app, making it easy for users to trade and transact in cryptocurrencies.

Setting up your Coinbase account:

• Sign up for Coinbase by visiting the website or downloading the mobile app.
• Enter your name, email address, and create a password.
• Verify your email address by clicking the link sent to your inbox.
• Complete identity verification by providing personal details such as your date of birth, address, and phone number. You may also need to upload a photo ID.
• Link your bank account by going to Settings > Linked Accounts > Link New Account. Provide your bank login credentials to connect your account.
• Add a payment method, such as a debit or credit card, or a PayPal account.

Buying cryptocurrency on Coinbase:

• Log in to your Coinbase account.
• Navigate to the Trade or Buy/Sell section and select the Buy tab.
• Choose the cryptocurrency you want to buy (e.g., Bitcoin, Ethereum, etc.).
• Enter the amount you wish to purchase.
• Select your payment method.
• Review and confirm the transaction details.

Selling cryptocurrency on Coinbase:

• Log in to your Coinbase account.
• Navigate to the Trade or Buy/Sell section and select the Sell tab.
• Choose the cryptocurrency you want to sell.
• Enter the amount you wish to sell.
• Select the fiat currency you want to convert to (e.g., USD, EUR, etc.).
• Review and confirm the transaction details.

Withdrawing funds from Coinbase:

• Log in to your Coinbase account and go to your assets page to view your account balances.
• If you want to withdraw fiat currency (e.g., USD, EUR), you must first sell your cryptocurrency holdings and convert them into fiat.
• Withdraw your fiat currency by going to your fiat wallet (e.g., USD wallet) and clicking "Withdraw."
• Enter the amount and select your preferred payment method (bank account, PayPal, debit/credit card, etc.).
• Review and confirm the transaction.

Additional considerations:

• Be aware of Coinbase withdrawal fees and limits, which vary depending on the withdrawal method, your account verification level, and the currency being withdrawn.
• For lower trading fees, consider using Coinbase Pro, which is designed for more frequent traders.
• Enable two-factor authentication to add an extra layer of security to your account.
• Avoid buying, selling, or withdrawing funds during periods of high network congestion, such as weekends or times of significant crypto price swings, as this can result in slower transactions and higher fees.

By following these steps, you can confidently buy, sell, and withdraw funds on Coinbase, making it a seamless experience for trading and transacting in cryptocurrencies.

The safety of buying and selling cryptocurrency on Coinbase

Coinbase is a popular cryptocurrency exchange that allows anyone with an account to buy, sell, and exchange cryptocurrency. It is a centralised cryptocurrency exchange, meaning it operates on a centralised infrastructure run by a single entity. It provides a user-friendly interface for buying, selling, and trading over 240 listed cryptocurrencies.

Coinbase has implemented several robust security features to protect its users' accounts and funds. Here are some of the key security features offered by Coinbase:

• Two-factor authentication (2FA): This adds an extra layer of security by requiring a second verification step, such as a text message or an authentication app, before accessing an account.
• Biometric Authentication: Coinbase enables biometric authentication, such as fingerprint or face recognition, on its mobile app.
• SSL Encryption: SSL encryption secures all website traffic between the browser and web server, protecting users' sensitive information by scrambling data, making it harder for hackers to intercept.
• Offline Storage: Most users' funds on Coinbase are held in offline storage, also known as cold storage, to protect against potential hacking attacks.
• Insurance Protection: Coinbase provides insurance protection for all eligible cryptocurrency holdings, including digital currency in the Coinbase Vault, to safeguard against theft and hacking.
• Account Activity Monitoring: Coinbase monitors accounts for suspicious behaviour and alerts users if any unusual activity is detected.
• Whitelisting: Users can set up a whitelist of approved addresses to ensure withdrawals are sent to trusted locations.

Coinbase also offers a feature called Coinbase Vault, which provides an additional security layer by allowing users to store their cryptocurrency in a secure offline location. With Coinbase Vault, users can create multiple sub-accounts with different permission levels, allowing them to give trusted individuals access to their funds for specific purposes.

While Coinbase has excellent security measures, it is important to note that no exchange is entirely risk-free. Cryptocurrencies are a relatively new and volatile asset class, and users should be aware of the potential risks involved. It is recommended to use a combination of security measures, such as strong passwords, 2FA, and cold wallets, to protect your crypto assets effectively.

Coinbase also has a wallet that is a non-custodial alternative for users who prefer a more interactive, on-the-go platform. It is crucial to keep your login details safe, as forgetting them could result in permanently losing your assets.

In summary, Coinbase provides a safe and secure platform for buying and selling cryptocurrency, offering multiple security features to protect its users' accounts and funds. However, users should also take responsibility for their security by implementing additional safety measures and staying vigilant against potential threats.

Coinbase's legal woes

Coinbase has faced a number of legal issues in recent years, including several lawsuits and regulatory actions.

In June 2023, the Securities and Exchange Commission (SEC) charged Coinbase with operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency. The SEC alleged that Coinbase had been unlawfully facilitating the buying and selling of crypto asset securities, intertwining the traditional services of an exchange, broker, and clearing agency without registering any of those functions. The SEC also charged Coinbase with failing to register the offer and sale of its crypto asset staking-as-a-service program. According to the SEC, Coinbase's conduct deprived investors of significant protections, including inspection by the SEC, record-keeping requirements, and safeguards against conflicts of interest.

The SEC's complaint sought injunctive relief, disgorgement of ill-gotten gains plus interest, penalties, and other equitable relief. Coinbase responded by arguing that the SEC did not have sufficient jurisdiction to bring the lawsuit. However, the SEC pushed back, stating that Coinbase had previously acknowledged the possibility that federal securities laws would apply to its listings.

In addition to the SEC lawsuit, Coinbase has also faced other legal issues. In March 2023, a Coinbase user sued the exchange after losing 90% of his life savings, amounting to about $96,000, to a hacker after his phone was hacked and his account accessed. Another user lost $2 million worth of cryptocurrency after their account was compromised, and they were unable to get meaningful help from Coinbase's customer support.

Coinbase has also faced criticism from consumer regulatory bodies, with thousands of grievances filed against the company with the Consumer Financial Protection Bureau. The Commodity Futures Trading Commission fined Coinbase more than $6 million in civil penalties.

Despite these legal issues, Coinbase remains one of the largest cryptocurrency exchanges in the world, with a vast user base of over 110 million verified users as of Q4 2022.

Frequently asked questions