Coinbase is a cryptocurrency exchange that is very popular with traders. It is widely available and easy to use. It offers easy access to crypto trading for beginners and enough options and features that seasoned traders use it as well.
Coinbase also has some downsides. It has higher fees than some of its competitors, reports of poor customer service, and requires identity verification which goes against the anonymity that many traders like about crypto.
Overall though, Coinbase is a very good crypto exchange that is used by millions around the world. If you are considering becoming or already are one of those users, it helps to know a little more about the platform. Here are five things to know if you use Coinbase.
1) Coinbase was early to the crypto market
While Coinbase wasn’t the first crypto exchange around, it was one of the earlier ones, which is one of the big factors in its growth. The company was founded in 2012 by current CEO Brian Armstrong and his then partner, Fred Ehrsam. In 2013, they received over $30 million in venture capital investments as the crypto trading market was taking off.
By the time 2014 hit, Coinbase was well-established as a cryptocurrency platform and partnering with major companies in order to help them establish crypto payment systems as well. That year, the biggest crypto exchange in the world, Mt. Gox, which handled over 70% of all crypto trades, was hit with a hacking scandal and declared bankruptcy.
Coinbase was one of the platforms that benefitted from a major player leaving the market. That year they hit 1 million users worldwide and were clearly on their way to becoming the most popular crypto platform in the world.
2) They are the Biggest Player in the Game Today
Just eight years after the company was first established, Coinbase has become the biggest platform for crypto traders. They boast over 35 million users in over 100 countries and have facilitated over $220 billion in crypto trades. The company currently holds over $7 billion in assets and employs over 1,000 employees.
In addition to being a trading exchange, they continue to be on the cutting edge of using crypto for payment as well. In October 2020, Coinbase officially launched its crypto-based debit card, Coinbase Card, in partnership with Visa. The card uses crypto funds in your account to back up purchases made with the card or even cash withdrawals from ATMs.
You currently have to join a waitlist to get a Coinbase Card but the card is authorized in almost 30 countries including the UK and throughout Europe. This kind of innovative forward-thinking is not only what has led to Coinbase being one of the biggest names in the crypto world, it is what will keep them on top for a long time to come.
3) It’s One of Many Cryptocurrency Exchanges Out There
Coinbase may be the biggest player in the crypto exchange market but it certainly isn’t the only one. The crypto trading market is a worldwide, 24/7 enterprise that is supported by many exchanges located all around the globe. While there are many alternatives to Coinbase out there, this article from Cove Markets has a breakdown of some of the most prominent ones.
Many of these exchanges offer features and benefits in categories where Coinbase falls short and are worth checking out for those interested in crypto investing. Many of the top competitors offer lower fees or a larger selection of crypto to trade, which is something that draws some traders away from Coinbase. Some of the top competitors include platforms like Binance, Kraken, Gemini, and more.
4) They Have a Special Coinbase Pro Platform for Active Traders
As mentioned, many traders feel that the major drawback of Coinbase is its high fee structure. Fees vary by how big your transaction is and what country you are making the transaction in. For example, basic trades in the U.S. in Coinbase will incur a fee between 0.5% and 4% on transactions.
For active, high-volume traders though, these fees are too high and would cost them a lot of money over time. To counteract this, Coinbase offers a special Coinbase Pro platform that offers lower fees and a sliding scale based on volume and whether trades are maker or taker trades.
On Coinbase Pro, both maker and taker fees start out at 0.5% for up to $10,000 worth of trading over a 30-day period. As a trader makes more taker trades, that percentage drops incrementally to 0.04% if they are trading over $1 billion. The maker fees drop even faster and go to 0% when over $50 million in trades happen.
5) You Won’t Find Every Cryptocurrency on Coinbase
If you are looking to trade some of the most popular cryptocurrencies in the world such as Bitcoin, Ethereum, XRP, or Litecoin, Coinbase has you covered. If you are looking for more of the thousands of cryptocurrencies on the market today, including other popular ones like Tether, Monero, or Tron, you won’t be able to do so on Coinbase.
Coinbase offers the ability to trade around 20 cryptocurrencies at any given time and also gives pricing info for around 50 different cryptocurrencies for market education purposes. This is a smaller number than many of its competitors. Other popular exchanges such as Kraken and Binance offer around double that number of cryptocurrencies to trade.
Coinbase is the most popular crypto exchange in the world and one of the most recognized brands in the crypto space. If you use Coinbase, it is helpful to know a little bit more about its history, the current state of the business, its competitors, its fee structure, and its crypto offerings. Knowing these will help you better identify if Coinbase is the best platform for you to use or if it makes sense to investigate alternatives. Coinbase will seemingly be a major player in crypto for a long time to come, so it is worth finding out more about the company.