Coinbase Review 2022: The King takes his Throne (of Simplicity)
Coinbase has surged to the top of the iOS app store and Android play in recent months, accompanying Bitcoin’s tremendous price gain. Coinbase currently has the tenth highest volume of exchanges worldwide, according to CoinMarketCap. It accounts for 20% of daily Bitcoin exchange volume, according to Bitcoinity. Coinbase has completed millions of trades with over 10 million users, making it one of the most popular exchanges, globally.
In this Coinbase review, we’ll look at why it’s one of the world’s most popular cryptocurrency exchanges:
Buying and Selling Cryptocurrency on Coinbase
Coinbase is designed for Bitcoin newcomers, focusing on simplicity and ease of use. Everyone has to pay a premium price when buying or selling on Coinbase. There is a flat fee of $1.99 per each buy or sale and a fee based on method of purchase. The current USA base fee is 4.00% plus the fees below.
Trading and Deposit Fees
Fees are fairly competitive with other cryptocurrency exchanges. Deposit fees vary based on the source.
- Bank Account (7 days) – 1.49%
- Bank Wire (2-3 days) – 1.49%
- Credit/Debt Card (Instant) – 4.00%
Their fee structure is complicated, and expensive. But that price is worth it, because Coinbase has supposedly the most protection and insurance of the USA based exchanges. Each payment method is different, but essentially they charge the highest fees, regardless of trade, and can change at their discretion. Coinbase generated reports show the fees calculated on each transaction. Their current fees are accessible on this Coinbase Support Article.
Coinbase Available Cryptocurrencies:
Typically when a new cryptocurrency is trading on the Coinbase exchange, the price pumps. Coinbase is always increasing support and has added dozens of new cryptocurrencies in 2021 alone! 2022 seems to be the year when support increases further1
- Bitcoin Cash
- Dozens more and adding all the time!
Information Needed to Buy Bitcoin on Coinbase
Coinbase prides itself as being one of the most regulated Bitcoin exchanges available. Because of this, it requires much more information than several other exchanges in order to buy or sell Bitcoin. Know Your Customer Laws are crucial for their business and maintained a regulated and secured environment for traders on the platform. As such, Coinbase requires more information than other exchanges.
Coinbase requires the following information in order to sign up
- Full Name and Address
- Email Account
- Phone Number
- Date of Birth
- Social Security Number (Last 4 digits)
- Online Banking Information
- Username and Password
- Answers for all security questions
- Questions pertaining to locality and branch (ie: where account was opened, previous account types, etc.)
This is alot of information to surrender in order to buy or sell cryptocurrency. This is more in line with what stock trading websites require, and it’s about time exchanges started to vet their userbase. Exchanges like Bitfinex and Binance are much more lax when it comes to signing up and trading. These exchanges may only ask for an email address and alias to get started trading cryptocurrency.
Completely USA Compliant Exchange
USA laws are becoming more stringent when it comes to cryptocurrency exchanges, and for good reason. Time has shown, over and over again, that exchanges are targets for hackers. Mt Gox is one of the legendary ones, but there are many more, including the (somewhat) recent Bitfinex theft.
Aside from serving over 30+ countries, check if yours is available here. Coinbase is one of two exchanges complying with BitLicense. Yes, that’s right, New Yorkers, you can buy and sell on a fully compliant exchange. We discussed their announcement previously here.
Simple Accounting Tools
Paying taxes on cryptocurrency trades have never been easier. Coinbase can create cost basis reports for tax/accounting purposes. This makes it incredibly useful for anybody paying taxes (read: everyone). It can become complicated keeping track of this with an excel sheet, but they make it easy to generate customized reports for integration with other accounting platforms and will prove useful when paying taxes.
Coinbase also integrates and automatically syncs with crypto tax apps, such as taxbit. For more on Taxbit, check out our Taxbit Review for 2021.
Limited Trading Tools and Options
We aren’t talking fancy stuff, like margin, options or lending/funding. The crypto exchange only allows people to buy and sell as simply as possible. It’s not even possible to enter a limit order. Everything is a market order, buy or sell. So one has to keep close watch on the price in order to pull the trigger.
GDAX, or Global Digital Asset Exchange, has reciprocal membership with Coinbase. If you’re setup for Coinbase, you’ll have a GDAX account. Every user has to upload a photo of their photo ID next to their face. This verification allows Coinbase to verify that it is you, instead of someone who just stole your information. This prevents stolen money from being transferred out to nefarious parties. Many have complained about how long this verification can take on Coinbase’s side. Users report taking days to weeks for GDAX to verify each user.
GDAX offers much more flexibility when it comes to trading. They allow market, limit, and stop orders for Bitcoin, Bitcoin Cash, Litecoin and Ethereum. It allows one to review charts and look at the order books. Because it’s integrated with Coinbase, these trades will be recorded and reports can be generated for tax purposes. We will further evaluate GDAX in a later review. It appears to be the power-trader platform.
Coinbase has come under scrutiny by their users for several concerning issues. 99Bitcoins wrote about these issues. Essentially, the primary issue is frozen accounts. The hair-trigger warning fuse of Coinbase allows for accounts to be frozen immediately, without warning, for any reason. This can be frustrating for investors who have used online stock trading platforms such as E-Trade, ScotTrade, etc. where downtime and frozen accounts are unacceptable.
Coinbase has promised to resolve these issues as they grow their employee base. They probably weren’t expecting such a boom, and are probably understaffed when it comes to support for disgruntled users.
Coinbase is for Bitcoin Beginners
From our expert perspective, Coinbase has enabled thousands of people to buy and sell Bitcoin. With the repeatable purchases, people are allowed to setup an account, verify it, then setup automatic purchases every day, week, or month. This is incredibly useful, especially when we encourage dollar cost averaging. Typically fees become more of a problem when doing this, but everything should be accounted for when aiming for a sell price.
Many see this as a positive, mainly for allowing those without technical or investing knowledge to buy and sell Bitcoin in a simple interface. There is another side, all these small transactions and uninformed investors may lead to higher volatility, and possibly even “bank runs”. By centralizing exchange volume and activity in the USA, they may be setting themselves up for failure. Only time will tell.
Sign up at Coinbase today and purchase $100 of Bitcoin to receive an additional $10 of Bitcoin free by using this link.
- Features - 7/107/10
- Ease of Use - 9.5/109.5/10
- Reliability - 9/109/10
Coinbase is designed for beginners, therefore it has limited trading features. It only offers basic buy and sell for Litecoin, Bitcoin, Bitcoin Cash, and Ethereum; but the accounting tools are unparalleled.
Ease of Use 9.5/10
Coinbase’s simple interface allows buys and sells to go through quickly. It’s easy enough for anyone to use!
Coinbase may have problems freezing accounts and banks dropping them from service, but their up-time is almost unparalleled.