Introduction to Coinbase Review

DecentraDecoded has conducted this Coinbase Review to give our expert opinion about this cryptocurrency exchange. Unlike other Coinbase reviews on the internet, this review will cover crucial aspects of the company, like its management team, products and services, costs and fees, promotion, and how safe the exchange is for your crypto trading and storage activities.

We used our standard crypto exchange review methodology to carry out this review process. As a crucial part of our processes, we contacted Coinbase Customer Service, some beginners, and advanced traders who have used the cryptocurrency exchange to meet their cryptocurrency needs.

When we contacted these people, we asked them specific questions about the company to help us form our unbiased opinion about Coinbase. 

Fortunately, the answers we got from these human sources when we reviewed the company were satisfactory enough for us to rate them as one of the top five crypto exchanges in the industry. 

This article contains all the fantastic details we found about the company and why we have rated it as one of the top five in the crypto ecosystem

DecentraDecoded is a crypto-based firm that helps newbies and advanced crypto enthusiasts navigate the crypto space safely. Our central aim includes reviewing crypto exchanges yearly to help our readers identify the most suitable, ethical, and comfortable to do business with.

This year, we have reviewed hundreds of crypto exchanges and carefully selected the best six companies for your crypto investment. These companies, in their ranking order, are:

  1. Coinbase
  2. Binance
  3. Bitby
  4. Local Bitcoin
  5. Kraken

We have rated these companies as the top five in the industry because when we reviewed them, we found fantastic details about them that made them stand out. 

We have put the details we found about them in six separate review guides for your education. Click the links above to download them for free. 

Overview of Coinbase

Coinbase, founded in June 2012 by Brian Armstrong and Fred Ehrsam, has grown from a simple Bitcoin brokerage service to one of the world’s most influential and widely recognized cryptocurrency exchanges. Initially, the company aimed to make Bitcoin accessible to the masses, a goal that resonated with the growing interest in digital currencies.

In its early days, Coinbase focused on providing a user-friendly platform for buying and selling Bitcoin, a significant step at a time when acquiring cryptocurrencies was a complex process for most. This ease of use rapidly attracted a large user base, and by 2014, Coinbase had expanded its services to include a professional trading platform, Coinbase Pro, catering to more experienced traders.

Over the years, Coinbase has continued to evolve, adding support for numerous other cryptocurrencies and expanding its services globally. In addition to its exchange services, the company has delved into various other areas of the crypto ecosystem, including a secure wallet service, institutional trading platforms, and, more recently, ventures into the realms of NFTs and decentralized finance (DeFi).

A landmark moment in Coinbase’s history was its direct listing on the NASDAQ in April 2021, making it the first major cryptocurrency exchange to go public. This event marked a significant milestone for Coinbase and represented a broader acceptance and legitimization of cryptocurrencies in the traditional financial world.

Coinbase’s Current Crypto Market Position and Reputation

Today, Coinbase is one of the Bitcoin exchanges that stands as a titan in the cryptocurrency world. It is widely regarded for its ease of use, security, and broad range of services. The exchange serves millions of customers worldwide and is often the first port of call for new entrants into the cryptocurrency market. Its user-friendly interface, fantastic phone support, educational resources, and commitment to regulatory compliance have made it a trusted name, especially among those new to crypto.

Coinbase’s current market position is robust, with a significant U.S. cryptocurrency exchange market share. The platform is known for its stringent security measures, which have helped it maintain a strong reputation despite the challenges and security issues affecting many crypto exchanges over the years.

In terms of reputation, Coinbase is often praised for its transparency and efforts to comply with regulatory standards, a stance that has sometimes led to criticism from parts of the crypto community that favor more decentralization. However, this regulatory compliance has also enabled Coinbase to bridge the gap between traditional finance and crypto, attracting interest from institutional investors and mainstream financial entities.

Coinbase’s commitment to innovation keeps it at the forefront of the rapidly evolving cryptocurrency landscape. The platform continuously updates its offerings to include new cryptocurrencies and features, keeping pace with the ever-changing demands and trends in the market. This adaptability and forward-thinking approach have cemented Coinbase’s position as a critical player in the global crypto ecosystem, with a reputation for reliability, innovation, and accessibility.

Coinbase Management Team

Brian Armstrong

Brian Armstrong, who leads the team as CEO, has a diverse background and experience at companies like Airbnb, Deloitte, and IBM. His career also includes running University Tutor, an online marketplace for finding tutors. Armstrong’s LinkedIn profile can provide more detailed insights into his professional journey.

Fred Ehrsam

Fred is the co-founder of Coinbase. He has left Coinbase to pursue other ventures but remains involved as a board member. He holds a dual degree in Economics and Computer Science from Duke University, and his early collaboration with Armstrong was pivotal in establishing Coinbase. 

Emilie Choi – President & Chief Operating Officer

Choi plays a pivotal role in overseeing the operations of Coinbase. She is responsible for the company’s day-to-day operations and is instrumental in driving strategic initiatives and business operations. 

Alesia Haas – Chief Financial Officer

Haas manages Coinbase’s financial operations. She oversees the company’s financial strategy, reporting, and risk management. 

L.J. Brock – Chief People Officer

Brock is responsible for leading Coinbase’s global workforce strategy. He focuses on cultivating the company culture, talent acquisition, and employee development. 

Paul Grewal – Chief Legal Officer

Grewal oversees legal affairs and government relations at Coinbase. He manages the company’s legal strategies, regulatory compliance, and advocacy efforts. 

Manish Gupta – EVP, Engineering

Gupta leads the engineering team at Coinbase. He drives the technological innovations and infrastructure supporting Coinbase’s services and products. 

Each of these executives plays a crucial role in their respective areas, contributing to the overall strategy, growth, and operational efficiency of Coinbase.

Coinbase Cryptocurrency Products and Services

Main Products and Services offered by Coinbase

Coinbase offers diverse products and services catering to different aspects of the cryptocurrency market. Here’s an overview:

Coinbase Wallet

The Coinbase Wallet is a self-custodial online crypto wallet, separate from the leading Coinbase.com platform, offering users control over their crypto assets. It’s akin to wallets like Metamask, where security is ensured through a seed phrase. 

The wallet is compatible with EVM and Solana networks and is accessible via a browser extension or mobile app, pre-installed with networks such as Arbitrum, Avalanche, and Polygon. Uniquely, it supports Bitcoin (BTC), Ethereum (ETH), Dogecoin, and Litecoin alongside all ERC-20 tokens. 

Users can interact with Web3 by linking dApps to their wallet, and its non-custodial nature allows broader jurisdictional support compared to Coinbase’s custodial services.

Coinbase Earn Overview

Coinbase Earn, a distinctive feature of the Coinbase cryptocurrency exchange, allows users to generate passive income from their crypto holdings. However, this program is available only to those with a Coinbase account. It is subject to geographical restrictions based on the countries where Coinbase operates and the completion of its KYC process.

Passive Income Programs on Coinbase Earn

The platform hosts three major passive income initiatives:

Staking

In this program, Coinbase facilitates the staking of users’ crypto investments in the Proof of Stake consensus of blockchain networks, enabling them to earn network token inflation rewards. 

Unlike traditional on-chain consensus processes that often involve a lock-up period and transaction fees, Coinbase simplifies staking by allowing users to stake or unstake at any time without transaction fees. 

However, Coinbase does charge a portion of the earnings as a commission. It’s worth noting that the assets available for staking can vary over time and by location as Coinbase adjusts its offerings in compliance with evolving local regulations.

Defi Yield

Coinbase’s DeFi Yield is a yield-farming product where users’ crypto investments are used in DeFi smart contracts, such as lending protocols, swap services, and Automated Market Makers (AMMs). Coinbase acts as a mediator in this setup, allocating subscribers’ funds to various DeFi protocols and distributing the earned fees or interest after deducting its commission.

Learn While You Earn

This initiative offers an educational approach where users earn rewards for learning about cryptocurrencies. Coinbase provides users with free educational resources, and they can earn crypto assets by passing quizzes on the platform. Designed primarily for beginners, the rewards from Learn and Earn may be less substantial for experienced or high-volume investors.

Pro-tip: Comparison with Other Exchanges

While Coinbase Earn provides these functionalities, it’s observed that the platform’s offerings in this area may not be as comprehensive as those of other leading exchanges such as SwissBorg, Binance, or Bybit. Users seeking more extensive or varied yield-generating opportunities might consider exploring these other exchanges.

Coinbase offers detailed educational content that elucidates the concept and its working mechanism for those keen to delve deeper into the specifics of staking.

Some Additional Products and Services 

Coinbase offers diverse products and services catering to different aspects of the cryptocurrency market. Here’s an overview:

Advanced Trading

Known as Coinbase Advanced Trade, this feature integrates the capabilities of the former Coinbase Pro. It offers advanced charting, market depth views, and a variety of order types, including market, limit, and stop-limit orders. 

The platform also partners with TradingView, offering customizable charts and over 100 technical indicators.

Coinbase One

This is a subscription-based offering that includes no-fee trades and other benefits for a monthly fee, enhancing the trading experience for regular users.

Coinbase Card

crypto debit card linked to the user’s Coinbase account facilitates easy spending of cryptocurrencies wherever Visa is accepted.

Coinbase Pay

offers a versatile payment feature, supporting a wide range of crypto and fiat currency options. Available on the Coinbase Wallet, Coinbase NFT, and select third-party apps, it facilitates transactions in over 60 fiat currencies and numerous cryptocurrencies.

Coinbase Commerce

Coinbase Commerce provides a plugin that enables online merchants to accept cryptocurrency payments on their websites. It seamlessly integrates with prominent content management systems like Shopify, Magento, and WooCommerce.

Educational Resources

Extensive educational materials are available in the Learn section, covering various topics from crypto basics to advanced trading strategies.

Web3 Access

A unique feature allows users to explore decentralized applications (dApps) across sectors like DeFi, NFTs, games, and music. To use these dApps, users must set up and connect a Web3 wallet.

Coinbase, with its range of products and features, positions itself as a versatile platform suitable for various users, from beginners to experienced traders, providing tools, resources, and services that cater to a broad spectrum of needs in the cryptocurrency market.

Coinbase Costs and Fees

Coinbase’s fee structure is multifaceted and varies based on several factors, including transaction type, size, and payment method:

Transaction Size-Based Fees

For transactions up to $10, Coinbase charges a flat fee of $0.99. The fee increases to $1.49 for transactions between $10 and $25, $1.99 for those between $25 and $50, and $2.99 for transactions between $50 and $200. Transactions above $200 are subject to a percentage-based fee instead of a flat fee.

Spread-Based Fees

Coinbase also imposes a spread-based fee of 0.50%, which is included in the quoted price for simple buy and sell orders and in the exchange rate for converting one cryptocurrency to another.

Payment Method Fees

The fees vary depending on the payment method used. ACH transfers are free, while a bank account or USD Wallet incurs a 1.49% fee. Credit or debit card transactions have a 3.99% fee, and wire transfers entail additional costs of $10 for incoming and $25 for outgoing transfers.

Coinbase Pro Fees

For users utilizing Coinbase Pro, the trading fees range from 0% to 0.5% per trade. Taker fees are between 0.04% to 0.50%, and maker fees range from 0% to 0.50%.

Overall, Coinbase’s fees are higher than those of some of its competitors, particularly for smaller transactions and those involving credit or debit cards. While providing multiple options and services, the fee structure may be complex for new users. 

This is an essential consideration for those sensitive to transaction costs, especially when choosing a cryptocurrency exchange for the first time.

Coinbase Crypto Exchange Promotions

Coinbase offers a range of enticing promotional offers to investors. As a new investor, you can take advantage of these promotions, including a free $10 worth of cryptocurrency, when you open your Coinbase account.

How to Open an Account with Coinbase

Creating an account with Coinbase involves a multi-step process designed to comply with Know Your Customer (KYC) laws and ensure the security and legitimacy of each account. 

Here’s a detailed and comprehensive step-by-step guide to opening an account with Coinbase, including the required documentation and verification process:

Step 1: Creating Your Account:

  • Visit Coinbase’s website or download the Coinbase app on Android or iOS.
  • Click or tap ‘Get Started’ and fill in your legal full name, email address, password, and state of residence.
  • Read and agree to the User Agreement and Privacy Policy.
  • You will receive a verification email to your registered email address.

Step 2: Verifying Your Email:

  • Open the email from Coinbase and select ‘Verify Email Address.’
  • Follow the link to sign back into Coinbase and complete the email verification.

Step 3: Phone Number Verification:

  • Upon signing into Coinbase, add your phone number.
  • Enter and submit the seven-digit code sent to your phone.

Step 4: Adding Personal Information:

  • Enter information as shown on your government-issued photo ID.
  • Answer questions about using Coinbase, source of funds, occupation, employer, and the last four digits of your SSN.
  • Select ‘Continue’ to complete the application process.

Step 5: Identity Verification:

  • Sign in to your Coinbase account and complete ID verification.
  • Identity verification is crucial for complying with KYC laws and preventing fraudulent accounts.

Step 6: Linking a Payment Method:

  • Choose the appropriate payment method depending on your country of residence.

Documentation and Verification Process By Customer Support

Accepted Identity Documents:

  • For US customers: State-issued IDs such as a Driver’s License or Identification Card.
  • For customers outside the US: Passport, Government-issued photo ID, or National Identity Card.
  • Ensure the document is valid and not expired.

Unaccepted Identity Documents

Coinbase does not accept the following as means of identification documents.

  • US Passports
  • Green Cards
  • School IDs
  • Medical IDs
  • Temporary IDs
  • Residence Permits
  • Public Services Cards
  • Military IDs

Remember: Following each step carefully and providing accurate and up-to-date information is essential to ensure a smooth account setup process.

If you prefer a more visual guide, click this link to see a video from Coinbase on how to open an account. Alternatively, you can watch the video here.

Coinbase Pros and Cons

Pros

  • Coinbase is known for its user-friendly interface, making it easy for beginners to navigate.
  • The platform supports various cryptocurrencies, offering diverse investment options.
  • It employs robust security measures, including two-factor authentication and cold storage.
  • Coinbase is fully licensed and regulated in the U.S., ensuring high trust.
  • Digital assets on Coinbase are insured for added protection.
  • Extensive educational resources are available to help users understand the crypto market.
  • Coinbase Pro offers advanced trading options and lower fees for experienced traders.
  • A convenient mobile app allows users to manage their crypto investments.
  • Users can earn rewards through staking and other incentive programs.

Cons

  • Coinbase’s fees can be higher than other platforms, especially for small transactions.
  • The leading platform may need more advanced features than experienced traders.
  • There have been reports of slow customer service response and unresolved issues.
  • The platform’s global availability is limited, restricting access in certain regions.
  • Instances of account lockouts without clear explanations have been reported.
  • Payment methods are limited and vary by region.
  • Collecting significant personal information due to regulatory compliance may raise privacy concerns.
  • Coinbase is subject to the volatile nature of the cryptocurrency market.
  • The platform has experienced performance issues during high market volatility.

Coinbase, one of the most popular cryptocurrency exchanges, offers a range of features and services that attract a diverse user base. However, like any platform, it has its advantages and disadvantages. Below is a detailed list of the pros and cons of using Coinbase:

Coinbase is a solid choice for those new to cryptocurrency due to its ease of use, range of features, and compliance with regulatory standards. 

However, its higher fees, potential customer service issues, and limitations in advanced trading features may lead some users to explore other options. As with any investment platform, weighing these pros and cons against personal investment goals and preferences is essential.

Is Coinbase Safe?

Coinbase’s status as a public company in the US and its position as a global leader in the cryptocurrency exchange market contributes significantly to its perception as a safe platform for conducting transactions, trading, and storing cryptocurrencies. Below, we delve into various aspects of Coinbase’s security measures and some of its challenges.

Security Measures Implemented by Coinbase

Two-Step Verification

Coinbase provides 2-step verification for all accounts, adding a layer of security against unauthorized access.

Encrypted Passwords

The passwords stored in Coinbase’s database are encrypted, making them unrecognizable and adding to the security of user accounts.

Coinbase Vault

This feature allows users to configure additional security steps for withdrawals, enhancing the safety of funds.

Protection of Deposits

Coinbase ensures that all customer funds are held 1:1 and are never lent out without the customer’s consent. This policy reduces the risk of runs on the exchange, particularly during periods of acute market volatility.

Cold Storage Wallets

Approximately 98% of funds are kept in air-gapped cold storage wallets, which are disconnected from the internet and employ multi-signature mechanisms. This approach significantly minimizes the risk of hacking, malware, and phishing attacks.

Challenges and Responses

Despite these robust security measures, Coinbase has faced its share of challenges:

Target of Attacks

Coinbase users and employees have been subjected to sophisticated phishing and social engineering attacks. For example, one user lost $96,000 in a SIM card change attack.

Proactive Response to Incidents

In response to such attacks, Coinbase has promptly addressed vulnerabilities and taken steps to mitigate potential widespread issues. 

No Disclosed Successful Breaches

Coinbase has not reported any successful breaches that led to widespread loss of customer funds. 

User Responsibility

While Coinbase takes substantial measures to secure accounts, users are advised to exercise caution and follow best practices for securing their funds and personal information.

Proof of Reserves and Financial Transparency

As a publicly traded company, Coinbase must file statements with the SEC, including proof of ownership of customers’ assets and details of its hot and cold storage wallets. Although Coinbase does not explicitly release Proof of Reserves data, its status as a listed company is a proxy for its reliability and trustworthiness in managing customer funds without unauthorized interference.

Coinbase is considered a safe platform for cryptocurrency transactions and storage thanks to its comprehensive security measures, regulatory compliance, and transparent financial practices. 

Pro-tip: However, like any online platform, it is not entirely immune to risks. Users should remain vigilant and adopt personal security measures to protect their accounts and assets. Combining Coinbase’s security infrastructure and users’ prudent practices forms a robust defense against potential security threats in the cryptocurrency space.

Final Thoughts – Coinbase is Best For?

From what we’ve looked at above, it’s clear that Coinbase stands out as a leading crypto exchange, especially for beginners. This is due to its straightforward interface and comprehensive offerings in DeFi, crypto assets trading, and NFTs. 

However, its limited global availability and higher fees for active traders are significant drawbacks to most traders. But security comes at a price; its adherence to regulatory compliances in regions where it operates ensures a secure trading environment. As a publicly listed company, Coinbase’s transparency and safety in handling customer assets are commendable, particularly in the often-opaque crypto space

For investors who value security and ease of use, Coinbase remains a top choice despite the evolving regulatory landscape and competitive market. 

Sign up for a free Coinbase account today and start trading!

Our Top Four Coinbase Alternatives

Are you looking for an alternative to Coinbase? While the best exchange for you may vary based on your unique situation, here are four options: low fees, security, liquidity, available crypto assets, customer support, and more!

Kraken

This cost-effective exchange offers trading in over 250 cryptocurrencies, with fees ranging from 0.00% to 0.26% on Kraken Pro. It’s notable for its proof of reserves audit, reliable customer service, and margin and derivatives trading options.

Binance

Renowned for its low fees (0.009% to 0.1%), Binance provides a vast selection of over 350 cryptocurrencies and futures, margin, and derivatives trading options. However, it’s important to note that Binance is not available in the United States.

Bybit

This exchange caters to a range of needs with over 100 crypto assets. Its spot trading fee is set at 0.1%. For derivatives trading, the maker fee varies between 0.01% and 0.02%, while the taker fee ranges from 0.03% to 0.06%.

Local Bitcoin

It facilitates P2P transactions with a diverse selection of over 100 crypto assets. While it offers a user-friendly spot trading fee of 0.1%, it’s important to note that the fee for completed trades can vary based on the method of buying or selling cryptocurrency, with a standard 1% fee for users who create advertisements.

Frequently Asked Questions

Is Coinbase Good for Beginners?

Yes, Coinbase is suitable for beginners. It offers an easy-to-use platform with simple tools for buying and selling, and it encourages learning through its “earn while you learn” program, which provides educational content and rewards for beginners.

Is Coinbase Better Than Binance?

Coinbase and Binance both have their strengths and weaknesses. Coinbase is known for its user-friendly design, educational content, and security, while Binance is recognized for its wide range of features and global presence. Coinbase’s reputation and transparency, especially within the US markets, give it an edge over Binance.

What Are The Best Features of Coinbase?

Some of the best features of Coinbase include its easy-to-use platform, educational content, security measures such as cold storage, and the “earn while you learn” program that incentivizes users to understand cryptocurrencies.

Differentiate Between Coinbase Simple, Advanced, and Prime.

Coinbase offers a simple platform with tools for buying and selling for beginners, advanced tools for more seasoned traders, and a prime service tailored for institutional investors. The advanced platform provides more features for experienced traders, while the excellent service is designed for institutional clients.

Is Coinbase A Trustworthy Trading Platform?

Yes, Coinbase is considered one of the top cryptocurrency exchanges in the US and is known for its top-notch security, including storing over 98% of client funds in cold storage. However, it did have a security incident in 2021.

How Do I Withdraw My Money From Coinbase?

To withdraw money from Coinbase, you can link your bank account to your Coinbase account and initiate a withdrawal. You can also use the Coinbase app to withdraw funds.

Can I Trade Nfts On Coinbase?

Yes, Coinbase allows users to trade NFTs (non-fungible tokens) on its platform, providing an opportunity to buy, sell, and collect digital artwork and other unique digital items.