A Coinbase Review for 2021
There are nearly 400 crypto exchanges in the world. However, only a handful of them has managed to become synonymous with the digital assets industry.
With more than 56 million verified users and nearly $335 billion of quarterly trade volume, Coinbase is one such crypto exchange that has become a household name among crypto investors of all sizes.
In this Coinbase review, we'll take a look at one of the most popular crypto exchanges in the world.
Table of Contents
Coinbase Review: Overview, Features, Security, and More
Coinbase has a lot to offer crypto holders. Learn more about what Coinbase is, how it works, and much more below.
Founded on June 20th, 2012, Coinbase has its headquarters in San Francisco, California. Started by Brian Armstrong and Ford Ehrsam, Coinbase is now a NASDAQ-listed entity and sells under the ticker COIN.
To date, Coinbase has raised a total of US $547.3 million from 15 rounds. The exchange launched its stock on April 14th, 2021, at an initial price of $381.00. Coinbase’s valuation during its IPO was $86 billion.
Coinbase has also made several acquisitions and investments. Zabo was one of its latest acquisitions, a company that connects any wallet to any crypto application in a few lines of code. Apart from Zabo, Coinbase also acquired Skew, Bison Trails, Tagomi, Routefire, Neutrino, Blockspring, etc.
Companies that it has invested in include Cortex, Risk Harbor, Alchemy, Tribe Accelerator, Rain, Securitize, and more. When it comes to its backers, 63 investors fund Coinbase, including Pegasus Tech Ventures and Paradigm, two of its most recent investors.
The services of Coinbase are available in more than 100 countries in the world. It supports trade in almost all the major and high visibility currencies. The list of assets includes Bitcoin, Bitcoin Cash, Ethereum, Algorand, Cardano ADA, Filecoin, Polkadot, and many more.
To make its security infrastructure more watertight, Coinbse stores user funds in a vault with time-delayed withdrawals. And all these services are available through the Coinbase mobile apps, available for download both on Android and iOS.
At its core, Coinbase is a crypto exchange for investors and retail traders to conveniently buy and sell crypto assets. It comes with a variety of features helping it to stand out from the rest.
For instance, its portfolio management feature not only helps to buy and sell popular currencies but also helps keep track of all the assets in the portfolio.
If an investor wants to schedule their buys, it is doable through Coinbase. You can set recurring purchases daily, weekly, or monthly.
Apart from its exchange service, Coinbase also has its wallet, which is as famous as the exchange.
- Coinbase Wallet: The Coinbase wallet serves as the perfect storage for all your crypto assets and NFTs. Leveraging the wallet, you can trade more than 500 assets on decentralized exchanges and earn interest income. You can start using the wallet by downloading it from Google Play Store and iOS app store. It is also available in the Amazon Web Store. You can start using the wallet even without having a Coinbase account. After its latest upgrade, you can now download the wallet extension on your desktop to connect it to crypto applications. To keep the storage secure, Coinbase protects users’ keys with Secure Enclave, biometric authentication, and optional cloud backups.
- Coinbase Card: Coinbase card is a seamless solution for spending your crypto assets anywhere you wish to. The card app is available for download on the iOS app store and the Google Play Store. The card is similar to a Visa debit card, fueled by Coinbase balance. The card is usable at millions of locations worldwide. You get the freedom to pay contactless and choose to withdraw cash from any ATM.
Coinbase: Sign-Up Process
You can invest, trade, and store your cryptocurrencies using Coinbase. To open an account with Coinbase, you need a government-issued photo ID, a computer or smartphone, and a phone number connected to your smartphone.
Once you have created an account on Coinbase, you need to verify your email address and verify your phone number.
Some personal information that is there on your photo ID has to be added, including your full name, your date of birth, and your address.
Additionally, you will also have to furnish information on your source of funds, current occupation, employer, and the last 4 digits of SSN. Once your ID verification is complete, the last step is to link a payment method.
The accepted payment methods for Coinbase US customers include bank account (ACH), instant cash out to bank accounts, debit card, wire transfer, PayPal, and Apple Pay.
To protect a part of its digital assets from events like theft and cybersecurity breaches, Coinbase leverages crime insurance, protecting a portion of the assets held across its storage systems.
To ensure fiat balances, funds held in USD, British Pounds, or Euros, Coinbase combines the user’s balance with the balances of other users, and holds those funds in custodial accounts at US banks or invests those in liquid US treasuries, or USD denominated money market funds under state money transmitter laws.
Coinbase stores 98% of customer funds online. To keep protected from theft or loss, Coinbase distributes its Bitcoin holdings geographically in safe deposit boxes and vaults around the world.
Sensitive data, stored on Coinbase servers, stays entirely disconnected from the Internet. The exchange further splits the data with redundancy, as it receives AES-256 encryption and copies it to FIPS-140 USB drives and paper backups.
To safeguard individual user accounts, Coinbase has 2-step verification on all accounts. Apart from their username and password, a user is also asked to enter a code from their mobile phone.
As an organization that values security the most, Coinbase also requires its employees to pass a criminal background check, encrypt their hard drives, utilize strong passwords, and enable screen locking. It also keeps application credentials separate from the database and codebase.
Coinbase Pros & Cons
Pros: The Good Stuff
Scores high on trust and credibility with more than 56 million users and nearly 350 Billion US dollars of quarterly trade.
Stores most of the funds in secure offline storage and maintains crypto insurance.
USD cash balances are covered by FDIC insurance.
Coinbase Pro offers advanced crypto trading services.
Assethub offers asset-listing services for businesses.
Coinbase Analytics serves perfectly for maintaining crypto compliance.
Coinbase Ventures helps raise money for crypto startups.
Cons: The Not So Good Stuff
The fees, especially for Coinbase Pro, are relatively higher.
There are no crypto futures or margin accounts.
Our Final Thoughts
Overall, this Coinbase review reflects a tried, tested, and highly credible product that has been functional for nearly a decade now. Its security standards are unmatched. It offers equal importance to the safety of the stored funds of the users as well as the security of an individual user’s account.
Its services are available in more than 100 countries, and it offers to trade in all the significant and high-potential assets with unmatched security. While the exchange is highly efficient, the card and wallet services offer best-in-class storage and spending avenues.
Frequently Asked Questions
Yes, Coinbase is safe. Coinbase scores are high as a place to store your funds and trade with them.
While it keeps 98% of customer funds online, it also maintains crypto-insurance and covers all USD cash balances by FDIC insurance, up to a maximum of $250,000.
To safeguard its data, Coinbase uses AES-256 encryption and then copies it to FIPS-140 USB drives and paper backups to distribute them geographically in safe deposit boxes and vaults around the world. It uses SQL injection filters to prevent CSRF attacks. Its website traffic runs entirely over encrypted SSL.
Yes, Coinbase is regulated. It is listed on the Nasdaq and also registered as a Money Services Business with FinCEN and complies with several financial services and consumer protection laws, including The Bank Secrecy Act, The USA Patriot Act, and other money transmission laws and corresponding regulations.
For its international markets, other than the US, Coinbase obtains licenses as needed to comply with local laws. Many countries across the globe now require licenses to operate a digital currency business.
Yes. Coinbase and GDAX both come under the corporate entity of Coinbase, Inc. The corporation has the necessary license to engage in money transmission in most U.S. jurisdictions mostly covering US Dollar Wallets and transfers.
In some states in the US, money transmission licenses also cover digital currency wallets and transfers on the platform, while in other states, no money transmission license is required to operate a digital currency business.