Coinbase is the largest Bitcoin broker globally, with users in more than 55 countries as of 2021.
- Liquidity and buying limits are high.
- New users can buy Bitcoin easily.
- Payment methods are limited.
- They keep an eye on how their users spend their Bitcoin.
Is Coinbase Safe For Trading?
Coinbase is a San Francisco-based digital currency exchange platform funded by legit investors. Up until August 2020, Coinbase has raised funds above $547 million.
Coinbase is the largest Bitcoin exchange and broker globally. The platform has an exchange called Coinbase Pro, which allows users to trade with other users. Coinbase makes money by taking a cut of these trade deals.
Users can purchase digital currency directly from Coinbase at the price they offer with the brokerage. On the brokerage side, there is no bidding.
This review will answer any questions about Coinbase and its products.
Is Coinbase Legit?
Coinbase is a popular crypto exchange platform. For this reason, new users usually wonder if the platform is a safe place to trade and store digital currency.
Let’s go through the various safety measures put in place by Coinbase and whether they are effective or not.
If you are wondering if Coinbase is legitimate, the answer is yes. Coinbase is a legitimate digital currency broker and exchange platform that is highly regulated and sponsored by recognised investors.
You will not have any issues, such as the platform running away with your money.
Since its inception, there have been no reports on the platform being hacked. This shows that Coinbase has put up various security measures that effectively ensure your digital assets are secure.
Coinbase has successfully prevented hacking to the extent that they also protect their users from falling for any hacking scams.
The platform requires users to give up some aspects of their privacy and control of their digital assets to avoid being hacked.
Should I Store Coins On Coinbase?
Storage is another vital aspect you need to consider.
Any money in Coinbase wallets is insured by the FDIC —values up to $250,000. FDIC does not offer insurance for digital assets. It is therefore advisable to move your crypto from the platform after making a purchase.
The cardinal rule in crypto trading in any crypto exchange platform is that you should never store digital assets on any platform. After buying digital assets from Coinbase, transfer them to an external wallet.
You may be thinking about why you have to do this.
As mentioned earlier, Coinbase is a popular platform targeted by many hackers who want to steal crypto from the platform. The fact that Coinbase has never been hacked does not mean it never will be. If they are hacked, you will never get your crypto back.
Luckily, moving digital assets from the platform to an external platform is easy.
How Does Coinbase Work?
Before we look into how to open an account on Coinbase or trade crypto, let’s look at the platform in greater detail.
How Coinbase Works
The platform’s interface makes it easy for new users to buy Bitcoin using regular payment methods.
The most popular payment methods used by Coinbase users are Debit Card payments and bank transfers.
User experience on the platform usually depends on the country you are in. Listed below are the countries in which Coinbase is operational, accepted payment methods, and the fees charged in your country depending on the payment method you choose to purchase digital assets.
Does Coinbase Support My Country?
The platform offers brokerage services in the United Kingdom, Singapore, Canada and the United States.
Other European countries supported on the platform include:
- Czech Republic
- Isle of Man
- San Marino
- The United Kingdom.
Coinbase supports Mexico, Canada and the USA IN North America.
Chile is the only country that Coinbase supports in South America. Users in Chile can only make purchases using Debit Card payments.
The charges listed on this review are only an approximation, and they vary depending on the purchase size and the country you reside in.
Coinbase Supported Coins
The platform supports multiple coins. However, the country you live in determines the digital assets you can trade.
Limits & Liquidity
The limits offered on Coinbase are very high. Your account levels determine your limits. The amount of verified information you have determines your account level. In the United States, fully verified users can purchase up to $50,000 worth of Bitcoin daily.
|Method||Limits||Time Before You Can Withdraw|
|Debit Card||Up to $7,500 per week||Immediate once debit clears|
|ACH Transfer||$25k per day (cumulative ACH limit)||Most users can make a withdrawal within five business days|
|Wire Transfer||Unlimited||Immediate once wire clears|
For European users, the maximum amount they can have in their account at any time is € 30,000.
Coinbase Payment Methods
Coinbase charges a lot of money—credit and debit card sales are subject to a 3.99% cost, while bank transactions are subject to a 1.49 per cent fee.
|Payment Method||Countries||Deposit Time||Currency||Fees|
|Wire Transfer||USA||5-7 days||USD||1.49% + $10|
|ACH Transfer||USA||5-7 days||USD||1.49%|
|SEPA Transfer||Europe||1-3 days||EUR||1.49%|
|SEPA Transfers||UK||1-3 days||GBP||1.49%|
You could be questioning why credit cards are not on the above table. Apart from Australia, Coinbase currently does not accept credit cards from other countries as a form of account financing.
This implies that Coinbase doesn’t take credit cards from Visa, Discover or American Express.
Coinbase customers in virtually every nation can transfer between currencies, but not necessarily into local cash.
You might wish to utilise Coinbase Pro for cheaper costs. It is more complicated, but it is worth understanding when you’ll be performing many trades and purchases.
Withdrawal Fees and Withdrawal Times
|Withdrawal Method||Country||Withdrawal Time||Currency||Fees|
|Wire Transfer||USA||1-2 workdays||USD||$25|
|ACH Transfer||USA||3-5 workdays||USD||free|
|Paypal||US, CA, UK, EU||instant||USD, CAD, GBP, EUR||variable|
|SEPA Transfer||Europe||1-2 workdays||EUR||free|
|Debit Card||Europe||0-1 days||EUR||2%|
|Debit Card||UK||0-1 days||GBP||2%|
|SEPA Transfers||UK||One workday||GBP||1.49%|
Your location and payment system determine the period that bitcoins take to reach your wallet and become usable.
Quick purchase will enable authorised customers to purchase up to $1,000 in bitcoin (BTC) weekly. On the other hand, level 2 customers with quick purchase can acquire up to $100 worth of bitcoin weekly.
- Debit Card: If you pay using a debit card, the Bitcoin delivery is immediate once your ID verification is completed.
- Bank transfer: If you reside in the United States, your Bitcoins will be delivered within five business days when you purchase using bank transfer.
It takes four days to make EFT purchases in Canada. For purchases made on Interac Online, the delivery is immediate.
If you make any purchase through SEPA, delivery of Bitcoins will be within 1-3 days.
How to Use Coinbase
Coinbase established the platform with beginners in mind. However, setting up an account is not as simple as it is navigating the platform.
Creating an Account
To create an account:
- First, visit the platform’s website and click “Sign Up”. Once you click “Sign Up”, the system will direct you to begin creating your account.
- Provide your name, location, email and password.
- Complete the captcha to ascertain that you are above 18 years of age and agree to the conditions and terms of using the platform.
- Log into your email to get the verification link sent by Coinbase. Click on the link and select your country and add our phone number.
You will receive a verification code on your phone, which you are required to enter when prompted.
After you key in the code, you may be required to verify your ID. If ID verification is not needed, then you’ve completed setting up your account for now. The next topic covered in the article shows steps to follow if you are prompted to verify your ID.
Whether you are prompted to confirm your ID, you should do it anyway—you’re required to verify your ID before you begin trading digital assets on the platform.
The ID verification process on the Coinbase platform cannot be bypassed. If it were possible to avoid the verification process, many people would skip it. If you fail to verify your ID, you will be locked out of purchases.
Coinbase has to adhere to KYC/AML regulations as they are based in the United States. According to Know Your Customer (KYC) and Anti Money Laundering (AML) regulations, businesses have to authenticate the identity of their customers.
If you were not required to confirm your ID after keying in the SMS code, click on the “Buy and Sell” icon, then select the “Submit ID + Photo Verification” tab.
You will then be required to give your details.
After filling in all your details, you will be prompted to submit a photo ID.
You can use a webcam or mobile camera to upload your driver’s licence or any other ID photo. You can also use a file upload.
Ensure that the photo is clear and there are no unclear parts of the ID so that verification does not fail. If the photo is clear and the verification fails, contact Coinbase support.
The verification process is completed once your photo ID has been verified.
The platform has different verification levels which determine how much money you can invest and how that money can be sent and received.
Optional: Set Up Additional Security
After ID verification, you should enable 2 -Factor Authentication (2FA) to make your account more secure.
Even though this step is optional, we advise that you do it to prevent hackers from getting unauthorised access to your account.
To enable 2FA:
- Click on the settings tab. Click on the Security tab within the settings page.
- On the drop-down list provided, click on “Two-Factor Authentication”. Set the verification code to be for any amount of cryptocurrency.
- Click on the “Enable Authenticator” tab.
- Key in the 7-digit code sent to your mobile phone.
Coinbase SMS Verification
After you enter the 7-digit code, an authenticator code will be generated for you. This authenticator code will enable you to use 2FA.
2FA is a security protocol that uses your secret authenticator code to generate unique codes. To use 2FA, you have to download applications such as Authenticator and Lastpass on your phone.
Once you download any of the apps mentioned above, add the authenticator code from the Coinbase platform.
The authenticator code can be entered manually or by scanning the QR code. The app will now generate unique 2FA codes for the platform that change every few seconds.
Ensure that you note down your authenticator secret code and keep it somewhere safe. You will need this code to receive 2FA codes if you buy a new phone.
Buying and Selling on Coinbase
You must add a payment method before buying your cryptocurrency.
The three payment methods offered by Coinbase include wire transfer, bank account, or debit card.
Adding Payment Methods
Adding a payment method is quite simple. Follow the steps below:
- Click on the “Settings” tab on the page(top middle).
- Press on the “Linked Accounts” tab on the Settings page.
- Select the “Link a New Account” button. Then you can pick your payment method of choice.
The best method of purchasing smaller amounts of cryptocurrency is via Debit cards. Debit card purchases immediately transfer the cryptocurrency to your account—this allows you to trade it for another cryptocurrency quickly.
However, Debit cards have purchase limits that are much lower compared to other payment methods. Their limits may begin from as low as $300 weekly.
Debit card purchases charge high fees of 4%.
If you want to link a debit card, click on that option, then enter your debit card information.
Sadly, you cannot use a credit card at this time if that’s what you have.
Coinbase will send two pending charges to your account after you finish filling out your card information. You need to enter the last two digits of the charge to verify your card.
There are no charges for these transactions. In case you get three charges, ignore the $1.00 charge.
Bank accounts are better options for larger purchases, though they are not instant like debit cards.
When you purchase with a bank account, the price you pay is locked immediately, although you will not get your cryptocurrency instantly—you will receive it after 4-5 business days.
You’ll make money if the value of the currency you purchased rises over that period, and you’ll definitely lose money if the value goes down.
Since you don’t own the funds until the 4th or 5th business day, you won’t be able to trade for another currency until the time elapses.
Bank account purchases have significant advantages—they have higher limits as from $7,500 weekly, and the fees are much lower (1.5%)
You can link a bank account by selecting it from the payment method section.
After choosing the payment method, pick your bank from the list, then fill out your bank user ID and password.
If you can’t find your bank or the procedure fails, you can add your bank account manually by filling out your routing number. For verification, you’ll be sent two deposits.
The whole process takes about five business days, contrary to the other methods that provide immediate connection.
After your account is set up, you can begin buying cryptocurrency.
Go to the top of the page and select the “Buy/Sell” tab. Choose the cryptocurrency you want, the amount in dollars and the fiat payment method. Then you will be directed to confirm your purchase.
To confirm the purchase, you may be required to enter your 2FA code.
The exact process applies when selling cryptocurrency. The major difference is that you can’t sell crypto using a credit card if you’re not an EU or UK resident.
You can only sell either through a USD account or a bank account that will hold your funds on Coinbase.
To send cryptocurrency to another account or deposit it to your Coinbase account, first, click the “Accounts” tab.
To deposit cryptocurrency, go to the currency you want and click “Receive”.
After this, Coinbase will send you an address to send your cryptocurrency to. Make sure you send only that currency to that specific wallet.
For instance, you can’t send Bitcoin Cash and Bitcoin to the same wallet; one will be lost. Also, ensure you use your address and not that indicated in the picture.
To send cryptocurrency to a different address, select “Send”.
Then, enter the recipient address and the amount you would like to send in dollars.
Ensure you send only to wallets of similar kinds of cryptocurrency. Only send Bitcoin on the next screen if you choose Bitcoin. Never send Litecoin(LTC) or Bitcoin Cash—you will lose the coins forever if you do.
To complete the transaction, you will have to enter your 2FA code. You will also incur an extra miner fee for sending currency. This fee is not for Coinbase; instead, it is sent to the miners who maintain the network.
With the knowledge of account set-up, depositing/withdrawing, buying/selling, you can now trade cryptocurrency smoothly.
Privacy on Coinbase
Coinbase provides one of the best user experiences of any exchange globally.
It can also protect you from being a hacking victim and from making mistakes.
We will now look into one thing you give up to get these benefits: privacy.
Is Coinbase Guaranteeing the Best Privacy Policies?
To successfully create a Coinbase account, you have to fill out your details—email, name and phone number.
If you’re working with a debit card, you will have to take a picture of your passport or driver’s license. This is the standard policy for a regulated crypto exchange such as Coinbase that complies with AML and KYC laws.
Coinbase is aware of your balance and addresses every time and can link this with your IP address and identity. You need to trust the nodes of Coinbase to verify transaction data.
Every payment request has a new address—this helps restrict other users from linking Bitcoin addresses together.
The 2015 Open Bitcoin Privacy Project’s Spring report gave Coinbase a score of 11 out of 100.
There has been news that Coinbase tracks bitcoin expenditure by users as far back as 2014.
The reports were confirmed in 2019 when it was disclosed that Coinbase had acquired Neutrino.
Neutrino is a tech firm that focuses on analysing standard blockchains to find out the identities behind addresses on the chains. Coinbase bought this company to reduce the privacy of Bitcoin users in all places.
Another thing worth noting is that a majority of Neutrino’s employees also founded and worked for the Hacking Team, a spyware company. Authoritarian governments in the Middle East bought the products of the Hacking Team to spy on their journalists and citizens.
Recently, Coinbase tried to sell its data to the Drug Enforcement Administration (DEA) and the Internal Revenue Service (IRS). Also, it succeeded in winning the contract to sell its data to the Secret Service.
What is the Coinbase Network Fee?
Coinbase doesn’t charge the Coinbase network fee—the blockchain charges this fee to send your coins.
A case in point is when you’re sending Bitcoins from Coinbase to yourself, and the Bitcoin blockchain charges Coinbase charges a fee to send the coins because it’s the sender that caters for all the fees.
So, when you get a network fee from Coinbase, remember that they are just passing on the fee from the blockchain to you to pay them back.
What is Coinbase Wallet?
Coinbase wallet is a non-custodial wallet that is owned by Coinbase and was developed by Toshi Holdings Ltd.
Contrary to the Coinbase app, which enables you to sell and buy coins and manage your coin holdings and fiat on the platform, Coinbase wallet is similar to other mobile wallet apps in which your mobile device holds the private key to your coins.
You don’t require a Coinbase account to access a Coinbase wallet.
SImply put, you do not control assets that are stored on the platform.
Is it Secure to Connect My Bank Account to Coinbase?
Coinbase is a company that is licensed and regulated in all districts in which it is operational.
The company is sponsored by high profile investors in the United States and is not a scam.
Therefore, linking your bank account with Coinbase. However, this does not mean you can store digital assets on the platform.
Who is Coinbase’s CEO?
The CEO of Coinbase is Brian Armstrong.
Why Is Coinbase Telling Me My Funds Are On Hold?
Funds usually get locked up when there is a lot of trading activity on the platform resulting in the system being overloaded with requests.
Unfortunately, when you encounter this, the only solution is to wait. You can also attempt to contact customer support. In most instances, they’ll inform you that bots automatically flag the holds, and nothing can be done.
The period you have to wait for the release of your funds varies as some individuals have been in the waiting room for several months.
It’s the same for withdrawals of dollars—your funds may be put on hold, and you’ll just have to wait.
Does Coinbase Accept Paypal?
Coinbase started accepting Paypal as a mode of withdrawing funds from Bitcoin sales and other crypto purchases on the site in 2019. However, you can’t use Paypal to buy crypto.
Why Isn’t Paypal Working with Coinbase?
There are several reasons why Paypal may not be functioning with your Coinbase account.
Coinbase can’t permit you to buy cryptocurrency using Paypal. For residents of the UK, EU and US, it’s not possible to sell crypto and use Paypal to take the sale money—residents of Canada are the only people allowed to make such a transfer.
Ultimately, ensure your Paypal account is integrated well with your Coinbase account—make sure Coinbase verifies your identity fully.
After verification, go to settings and click “Link a new account” on the Linked Accounts section. If you are using a mobile, go to settings and select “Add a Payment Method”.