Created in 2012 by Brian Armstrong and Fred Ehrsam, Coinbase’s reputation lies with its presence in 32 countries across the world – especially in the USA, UK, and Brazil, which represent their largest customer bases, respectively.
Did you know? In 2013, Coinbase asked Vitalik Buterin to come in for a chat. They nearly offered him a job on their team. This didn’t happen though, as Vitalik went on to create Ethereum early the following year. It seems Coinbase have always had a very positive view of Ethereum, its applications, and potential.
Advantages of Coinbase
- Two types of wallets are available:
- The first is really simple and made so that beginners can store their coins with peace of mind (wallet key security is managed by Coinbase).
- The second is called Multisig Vault and uses the “multi-signature” innovation which allows advanced users to self-manage security for their wallet keys. What does this mean? Well simply put: if Coinbase were to disappear then these users would still have control over their bitcoin. For those asking is Coinbase safe, this should partially answer your question.
- Is Coinbase safe? All deposits are insured. Now here is some serious security from Coinbase. That being said, if your password gets cracked or stolen then this would not be covered by their insurance policy. Always use a long and unique password.
- Many positive Coinbase reviews mention that sending cryptocurrency to other users (who also have wallets on the platform) is really easy and fast. I strongly agree with this. With all the recent backlog on the actual bitcoin network, the fact that Coinbase allows users to do off-chain transactions is a pretty sweet feature. No more idle waiting times while you worry about confirmations.
- In 2016 the site made PayPal BTC sales available to US users. This feature will soon be available to European users looking to sell their bitcoins for PayPal.
- It is possible to link a credit card, called Shift Card, to your account and then pay for daily purchases using your Coinbase balance. The system simply converts the coins into usd at the going rate at time of purchase. This feature is not yet available outside of the United States.
- First site among all the exchanges out there to have opened up a direct customer support telephone line.
- It’s true that we often read reviews about Coinbase stating that it’s one of the best places for new users and beginners wanting to get their first bitcoins. In this area the company receives so many recommendations owing to the fact that large investments were made to guarantee an impeccable user interface (UI) and experience (UX). Everything works right out of the box on all devices. There is even a smartphone app for android and iOS.
- In my opinion the lack of friction on-ramping from the existing financial infrastructure is thanks to strong partnerships with the latter. For example, some of the largest Coinbase investors include BBVA, NYSE, and Andreessen Horowitz.
Disadvantages of Coinbase
- Only available in three currency zones, the USA (dollar), Europe (euro), & Great Britain (GBP).
- They have a cap on how much cryptocurrency you can buy each week. Lots of investors are now looking to invest in large quantities of cryptocurrency, with a cap of $1,000 a week, they may well look to go elsewhere. For those looking to buy large amounts of cryptocurrencies try CryptoGo.
- You can only buy 4 cryptocurrencies; Bitcoin, Bitcoin Cash, Ethereum and Litecoin. Those that are looking for a more diversified portfolio will have to look at different exchanges.
- Suffering from its own popularity, waves of people flock to signup each time the price rises. Such events cause significant delays for vetting and approving new accounts. Note that all major crypto exchanges are experiencing such issues.
- The downside of running a super safe exchange is that some customers get flagged and subsequently accounts get temporarily frozen. Extra vetting fixes this issue, but as waiting is no-ones favourite hobby people generally take to complaining on forums including reddit. I would go as far as saying that some good PR work would be needed to reassure the community.
- Picking up on my last point, Coinbase support really needs to be more present on reddit. I’m talking about r/bitcoin and r/Coinbase – where some customer issues have gone un-answered for over 24hours. Tweeting @CoinbaseSupport (on twitter) usually gets an answer within the hour, but still – reddit… it’s the front page of the internet.
- Some reviews complain that Coinbase care more about their investors than it does about their users. This point would need further clarification but interesting nonetheless.
- There are reports suggesting your coins may be tracked after withdrawing from the exchange. What does this mean? Being part of the Blockchain Alliance, Coinbase actively fights to avoid the use of digital currency in illegal and unlicensed activity. In other words – if you’re using the coins to gamble or to purchase frowned-upon substances, then don’t use Coinbase.
- Some sections of the bitcoin community resent Coinbase’s involvement in the current block size debate, or even the patenting of so-called inventions such as a bitcoin exchange or btc tip buttons. Yes – slightly excessive. Nevertheless actions like these will not have much of an impact for those looking to buy and sell btc, but feel free to look it up further if you are into the politics side of bitcoin.
- One issue we are seeing crop up a lot is the high fees Coinbase charges. Often up to 4.5% on a transaction, which is considerably more expensive than many other exchanges.
Interview with Brian Armstrong
Here is an interview of CEO Brian Armstrong in 2015 where he talks about Coinbase: