Founded in 2012 in San Francisco, Coinbase is a custodial digital currency wallet with an integrated trading platform.
Founded in 2012 in San Francisco, Coinbase is a custodial digital currency wallet with an integrated trading platform. It was one of the first applications that would let users buy bitcoin with a credit card and custody funds on their behalf, making cryptocurrencies accessible to a much less tech-savvy audience. Since then it has evolved a lot, offering multiple products and services, many of which but not all are available through the coinbase.com wallet.
It claims to offer its services in 130+ countries but that's only true for the basic crypto custody solution and crypto-to-crypto exchange. The possibility to buy and sell crypto using fiat ( debit/credit card, bank deposits etc.) is only available in Europe, USA, Canada, Australia, Singapore, Chile and Mexico.
Sign up is done through Coinbase’s website where users have to go through a conventional sign-up procedure, including verification of email address and phone number as well as uploading ID documents and a selfie. The phone number is used to protect your account with Two-Factor Authentication (2FA), meaning that an SMS verification code is required for every log-in into your account. It’s surprising that although the app is available on mobile (iOS/Android), the sign-up itself needs to be completed through the website.
Everything about Coinbase, from the design & user experience to the variety of features, show Coinbase’s professionalism and standing as the most established company in the crypto space. However, this convenience comes at a rather high price. Coinbase’s pricing for crypto purchases and sales is multi-tiered and complicated. It consists of a fixed markup of 0.5% applied on the exchange rate plus whatever “the Coinbase fee” is. Roughly speaking, the Coinbase fee is $0.99cts. - $2.99 for transactions below $200 and becomes a fixed 1.5% for purchases above $200. Naturally, debit/credit card transactions are more expensive coming at a 4% cost. For a comprehensive pricing breakdown check here.
Coinbase Earn let's new users watch introductory videos on ZCash, Tezos, Stellar and a range of other cryptocurrencies and receive amounts of up to $30 in the respective currency in exchange. Educating users on Blockchain and cryptocurrency seems to be a conscious strategy of Coinbase, which is also visible in the effort to display crypto news from Coindesk, Forbes and other sources within the app. We also like the 'Market stats' window showing users how popular a given asset is within Coinbase. It shows for example, the percentage of people who have bought a specific asset within the last 24 hours vs. those who sold it, the trading volume, typcial hold time and other relevant metrics.
Coinbase also has a debit card but it’s only available in about 15 select countries in Europe. It costs $4.95 up-front to order the card and you need to download a separate app to sign-up and manage the card. The card is connected to your Coinbase account and automatically converts crypto to fiat at a 2.49% fee (if there’s no fiat in your account) when you purchase something. Moreover, there's an additional 3% fee if you're travelling outside the EU and make purchases in a currency other than the Euro and a 1% fee for domestic ATM withdrawals once you exceed their $200 allowance.
Coinbase’s card is definitely not its strong selling point and we rather recommend Wirex for people wanting a crypto enabled debit card to spend their crypto on a daily basis. We also wrote a comprehesive comparison of the the best crypto cards, comparing the most important card options globally side-by-side.
On the downside, Coinbase’s customer support is severely lacking. In our experience, they were extremely hard to reach by e-mail and wouldn’t respond to several of our inquiries. We even reached out to their dedicated support channels on social media but to no avail.
Overall, whilst one of the more expensive options, Coinbase is simple to use and thus a great option for those wanting convenience.
We are a multi-faceted team of crypto enthusiasts based in Berlin.
© 2021 cryptotesters UG
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