In this Coinbase Review, we will cover the basics of cryptocurrencies, how to purchase alternative coins, features of Coinbase, Coinbase fees, GDAX fees, answer “is Coinbase safe”, buying Ethereum with a credit card, the authors personal experience and more. Lets dive in!
Note, if you signup and trade on Coinbase, with any of the links below, you will get $10 for free from Coinbase!
If you are interested in other alternatives to Coinbase, then check out “Four Coinbase Alternatives” by CoinCentral.
What are Cryptocurrencies?
The simplest way to define “cryptocurrency” is to use the term digital money. There are different currencies of digital money that are made by different companies, much like the U.S. dollar, British pound, etc. It is important to note that each currency is completely independent of each other, however many people believe that all cryptocurrencies are linked together which causes confusion. Cryptocurrencies gain value according to the supply and demand of the coin itself. You can buy and sell these coins on different exchange sites such as Coinbase, GDAX, Binance, etc. These exchange platforms work similarly to stock market exchange sites. You can place a bid to buy or sell a coin at whichever price you are willing to pay, and the transaction is completed whenever the market price matches your bid. Another option is to have a broker, Coinbase, give you a set market price to buy the coin at. Cryptocurrencies are built from, and run on, blockchain technology. Blockchain technology is extremely secure and builds each coin off the other, making it impossible to hack or counterfeit. If you hear of a cryptocurrency heist or attack, it’s the website that is holding the coins that is being hacked, not the coin itself. The first cryptocurrency ever created was Bitcoin, which is now the most popular and most valuable cryptocurrency. All other coins are called “alt. coins” short for alternative coins. Coinbase, which is a cryptocurrency bank/broker offers 4 different coins that can be bought and sold: Bitcoin, Bitcoin Cash, Ethereum, and Litecoin.
Investing in cryptocurrencies has become recently popular because of the massive price fluctuations that cryptos have been experiencing, which has yielded a great return for investors. What’s unique about cryptocurrencies is that you don’t have to buy a full coin. For example, you can buy a fraction of a Bitcoin and if the price rises 10%, then you make 10% on your original investment. So don’t worry if you can not afford to purchase an entire coin!
About Coinbase Exchange:
Coinbase is a cryptocurrency bank/broker that was founded in 2012. Based out of San Francisco, California, the company currently serves 32 countries and has over 10 million customers. The CEO, Brian Armstrong, holds the number ten spot on Forbes 40 Under 40. It has been recently posted that Coinbase made over $1 billion U.S. in revenue in 2017.
Pros:
- Extremely user-friendly app
- Easy to link with bank accounts
- Access to GDAX exchange (Coinbase’s exchange platform) for smaller exchange fees
- Supports 4 major cryptocurrencies (Bitcoin, Bitcoin Cash, Ethereum, and Litecoin)
- Easy to send and receive currencies through QR codes
- Complies with U.S. laws
- FDIC insured – Coinbase is safe
- Website offers exceptional security
- Prices are updated in real time
- Graphs show progression of currency price
- Ability to create price alert notifications to your phone
- Ability to change native currency
Cons:
- Buying and selling is sometimes suspended during high traffic volumes of trading
- Coinbase tracks transactions to and from websites and reserves the right to freeze your account if you are suspected of using your coins on illegal darkness sites
Is Coinbase Safe?
Yes. Coinbase claims all of the following:
- “Coinbase stores all customer fiat currency (government-issued currency) in segregated, custodial bank accounts”
- “Cash balances held in your Coinbase accounts belong to you, not Coinbase”
- “If you are a United States resident, your Coinbase USD Wallet is covered by FDIC insurance, up to a maximum of $250,000”
- “Even if Coinbase were to fail as a business, the funds held in the custodial bank accounts could not be claimed by Coinbase or its creditors. The funds held in those accounts would be returnable to Coinbase’s customers”
How to set up an account:
Go to Coinbase here, then enter your information into blank spaces provided.
Once you have filled out the form with your information, Coinbase will ask you to verify your email address by sending you an email that has a “verify email” button. Once this button has been clicked, you will be redirected back to Coinbase’s website, where you can continue the sign up process by verifying your identity. After you verify your identity, you must select your type of payment.
After your payment setup is complete, all that is left to do is click the “buy/sell” button in the top left of the screen (If you are on the desktop version of the website).
Coinbase Fees:
Coinbase charges conversion fees when transferring from bank accounts or purchasing with credit/debit cards. It appears that Coinbase fees are ever changing, and can range from 0 to 200 basis points. Please check the current Coinbase fees here.
GDAX Fees:
GDAX fees may be changing too as Coinbase recently updated their fees (check here), however here is the current GDAX fee structure. “When you place an order at the market price that gets filled immediately, you are considered a taker and will pay a fee between 0.10% and 0.25% for BTC books and 0.10% and 0.30% for ETH books.
When you place an order which is not immediately matched by an existing order, that order is placed on the order book. If another customer places an order that matches yours, you are considered the maker and your fee will be 0%.” (Taken from the GDAX fees section)
Coinbase Support:
Users may contact Coinbase support through email via the “submit request button” on the support page, or by phone +1 (888) 908-7930. Coinbase phone support is available Monday – Friday, 24 hours a day. When you call Coinbase’s customer support number you will reach an automated message system, but if you stay on the line you will be transferred to a representative. The downside is that their representatives are typically always busy. From my own experience, I have found that the best way to get a response from most companies is to message them through twitter. Many companies have a Social Media Manager that has quicker response rates than customer service. Coinbase status updates are also posted to twitter on the following accounts: @CoinbaseSupport and @coinbase
Can You Buy Ripple On Coinbase?
You can not buy ripple on Coinbase, however most people purchase Bitcoin, Litecoin or Ethereum on Coinbase and then transfer the funds to Binance where Ripple can be purchased.
Is Coinbase A Wallet?
Yes, Coinbase can be used as a wallet. Coinbase also offers additional security for those who are looking to store funds for a longer term called “Vault.” This goes back to the question of is Coinbase safe? Yes, your security is their priority.
Buy Ethereum With Credit Card
Since Coinbase accepts credit cards and debit cards, you can buy ethereum with a credit card. It is important to note that Coinbase no longer supports linking new credit cards to ones account. They encourage that you purchase cryptocurrencies with a debit card.
Coinbase PayPal
Currently you can not use PayPal to fund your Coinbase account. Addtioanlly, Coinbase has disabled the “Coinbase PayPal” withdraw feature as there were technical difficulties. Recently Coinbase released a plugin that acts like PayPal and allows people to send/accept payments in Ethereum, Bitcoin, Bitcoin Cash and Litecoin. We hope that there is Coinbase PayPal connection in the near future.
Personal Experience with Coinbase Exchange:
I’ve been using Coinbase and Binance for about two years now, and have to give them both 5 out of 5 stars. Being just a recreational investor, I have earned over a 500% return on my initial investment during this time. I mostly use the Coinbase app because of the convenience and ease of use. You’ll find yourself constantly opening the app to watch the price fluctuations. The desktop version of Coinbase is phenomenal as well, I use it when I’m transferring my funds to Coinbase’s exchange website GDAX, or other websites. Exchanging your funds to GDAX is instant and completely free. The benefit of GDAX is that you can make bids on the price that you buy and sell coins at. When you buy and sell through Coinbase, you are buying and selling at a generated market price, which can be a bit pricier. Coinbase has four of the most popular cryptocurrencies: Bitcoin, Bitcoin Cash, Litecoin, and Ethereum, so it is a good place to start investing in cryptocurrencies if you are a beginner. Having a Coinbase account also allows you to transfer your funds to other exchange websites that offer more alt. coins. By transferring funds from Coinbase to these other websites, you are able to bypass the extensive personal verification processes that these sites have. The funds can be transferred via QR code from the Coinbase exchange instead of having to do a wire transfer from your bank. I treat Coinbase like my trusted bank when it comes to cryptocurrencies. It’s the only place on the internet where I feel completely safe storing my cryptocurrencies and I definitely recommend it for others.
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