September 28, 2022
  • September 28, 2022

Coinbase Review: Simple Platform for Cryptocurrency Beginners

By on August 29, 2022 0

Coinbase is a cryptocurrency exchange designed for beginners. With its easy-to-use interface, wide selection of digital assets, and low minimum purchase amount, it’s no wonder Coinbase is the tenth largest exchange in the world by trading volume.

Beyond ease of use, investors may find some drawbacks. In its Q1 2022 earnings report, Coinbase said users could lose all of their cryptocurrency if the company goes bankrupt. Then Coinbase lost more than half of its value in the first half of 2022 and laid off 18% of its workforce.

Apart from company performance, other disadvantages include relatively high trading fees and a complex fee structure. Coinbase users are also required to hand over a lot of personally identifying information, which defeats the purpose of anonymizing digital transactions. For these reasons, seasoned crypto investors may want to look elsewhere.

Read our full Coinbase review to see if it’s the crypto exchange for you.

Coinbase Review: Features

It’s easy to start investing in cryptocurrency with Coinbase, but you might not like all the features. Here is an overview:

Digital storage

When you buy crypto and NFT assets, you can store them online through your personal account or in a Coinbase wallet, available through a mobile app. Users can also import other wallets into the Coinbase app or transfer coins from other wallets.

Of course, digital storage isn’t the most secure method of holding digital assets, but it might be the preferred option for newbie investors.

For added security, you can store your assets in a digital “safe”. Assets in a vault cannot be traded immediately, but rather the owner must approve transactions within 24 hours of any request, and a waiting period of 48 hours must pass before the transaction is completed .

Learning Rewards

Users who complete Coinbase learning modules can earn free crypto. You’ll need to upload a photo ID and wait for verification (this can take up to 48 hours), watch a series of short graphic slides, and take a three-question quiz (answers are readily available online) to earn a reward.

The modules are full of crypto insider jargon, so you might not learn much, but you can currently earn $1 in GRT, GAL, ALEPH, or AMP for completing each module.

(Image credit: future)

Insurance

Coinbase offers the same deposit insurance as Gemini, eToro, and some other exchanges.

Users get up to $250,000 in FDIC deposit insurance, which covers certain cash deposits for security breaches and certain types of theft not caused by user error.

Contrary to popular belief, crypto assets are not insured by this coverage. The FDIC has released a fact sheet on deposit insurance (opens in a new tab) to provide clarification.

Security

Coinbase hits seven for security on CER list (opens in a new tab) of the best crypto exchanges. Most of Coinbase’s digital assets are encrypted and stored offline, and account access requires 2-step verification.

(Image credit: future)

But some of the exchange’s security measures require users to sacrifice their anonymity.

Each user must provide their name, email address, phone number, employment status, and the last four digits of their social security number to create an account, and then must submit photo ID to enable registration. sending and receiving.

Like most websites, Coinbase also automatically collects IP addresses and uses geolocation, and the exchange verifies identity information to comply with anti-money laundering laws.

Coinbase Review: Pricing

There are no upfront fees or subscription fees to create an account, but Coinbase fees can still be a deterrent. Exchange fees are complex and highest for trades under $10,000. They are also high compared to other exchanges. Here is a breakdown:

  • 0.40% manufacturer fee
  • 0.60% support fee
  • 1% conversion fee (to exchange crypto for fiat currency)
  • Variable network transaction fees

Investors may prefer an exchange like Crypto.com, where the maker/taker fee is 0.075% for trades under $250,000, or Binance, where some trades have no maker/taker fee.

Coinbase Review: Ease of Use

Where Coinbase shines is user-friendliness. You can visit the website or download the app (available for iOs (opens in a new tab) and Android (opens in a new tab)), create an account and be ready to trade in minutes.

Once your account is set up, you can easily sort through the exchange’s long list of assets and see a quick overview of each’s performance chart. Choose from ‘simple’ or ‘advanced’ views, or filter the lists as ‘winners’ and ‘losers’. Once you’ve made your choice, you can also easily set up recurring purchases.

(Image credit: future)

To make a purchase, you will need to link a payment account. Like other exchanges, you cannot use a credit card. If you choose to link a bank account, you will have to wait three to five days to complete a transaction. Alternatively, instant payment can be set up via debit card, PayPal, Apple Pay or Google Pay.

It should be noted that the exchange has instituted occasional trading breaks and customers have made continuous complaints about technical issues accessing their accounts. Both of these issues can cause users to delay their transactions.

For instance, Coinbase recognized on August 3 (opens in a new tab), via his @CoinbaseSupport account on Twitter, that users were experiencing login and connectivity issues. Despite twice announcing that the problem was fixed, customers were still tweeting their long-standing connection complaints and error/alert screenshots up to 10 days later.

Coinbase Review: Support

Phone support is available 24/7 in the United States. Chat support is also available 24/7. However, you’ll start chatting with a virtual assistant before you’re connected to a live agent, and getting someone live can be tricky.

Users can also submit help requests via email or send a DM via Twitter to @CoinbaseSupport (opens in a new tab). Like web chat, getting anything other than a scripted response via Twitter DM can be difficult.

How Coinbase Compares to the Competition

Coinbase is one of many platforms for investing in crypto. Here’s how it compares to your other options:

Crypto.com

Crypto.com has a higher CER security rating (it’s number one) than Coinbase. The exchange also has lower transaction fees than Coinbase, allows margin trading, and the minimum purchase is $1, but Crypto.com trading is currently not available in New York.

Binance

Binance is for more advanced investors. It has a higher security rating and lower trading fees than Coinbase, including no fees for Bitcoin trading.

But Binance has seen far more regulatory issues than Coinbase and has been in the spotlight for facilitating money laundering. The exchange is banned in the UK, has been temporarily banned in Italy and is also banned in the US

Therefore, investors must go through the sister company, Binance.US, which is still not available to people living in Hawaii, New York, Texas, and Vermont.

Robin Hood

Unlike Coinbase, Robinhood is a brokerage, so investors can use the platform to buy stocks and ETFs, but cannot trade.

Robinhood charges 0% for crypto purchases, and the minimum investment is only $1, but the brokerage hosts a smaller selection of cryptocurrencies than Coinbase, and purchases are not allowed in Hawaii and in Nevada.

Coinbase Review: Verdict

Coinbase can be a good choice for beginners. The exchange ranks well for security, accounts are easy to set up, and the trading interface makes it easy to screen for the digital assets you want.

But more advanced investors may find Coinbase disappointing. Between occasional trading freezes, relatively high technical issues and fees, and handing over a lot of personal information, frequent traders may find the platform unsatisfactory.

Frequently Asked Questions (FAQ)

What is the minimum investment amount for Coinbase?

You can start investing on Coinbase with a minimum of $2. The exchange does not charge any upfront fees or subscription fees to create an account.

Does Coinbase insure my crypto?

Coinbase does not insure crypto. However, if you store fiat currency in your Coinbase account, up to $250,000 may be covered by FDIC deposit insurance.

What is Coinbase Pro?

Coinbase Pro is a crypto trading platform owned by Coinbase. Coinbase users can upgrade to Pro for free and access a more advanced interface, but Coinbase Pro will no longer be available after the end of 2022.