When cryptocurrencies were still a new thing, it was quite difficult to get your hands on them. You could either mine BTC with a computer, or you could manually search social media groups and crypto forums for individuals willing to sell you some BTC.
This used to be a rather stressful process because you never knew who you’ll run into online and whether they’ll keep their end of the deal, or just take off with your cash. The appearance of the first cryptocurrency exchange platforms in 2010 entirely changed the market situation and for the better.
Crypto exchanges enabled users from all over the world to securely purchase, sell and exchange various digital currencies without the fear of being tricked or robbed. Some of the most popular crypto exchanges on the market include Coinbase, Binance, Gemini, Bitfinex, and Kraken. These platforms offer a wide range of trading features and are trusted by millions of people thanks to the high quality of their services.
In this guide, we’ll take a detailed look at Coinbase.com, one of the top crypto exchanges on the market, learn about the services it offers, and how to verify your bank account as a payment method on the platform.
Coinbase is considered a veteran crypto exchange, launched in 2012, just two years after the first Bitcoin exchange platforms emerged on the market. The idea behind Coinbase was to launch a crypto exchange that would provide users with top-quality services that are sufficient to satisfy the crypto needs of different trading profiles.
As a result, Coinbase’s users have much more at their disposal than simple buy, sell, and exchange options. The platform offers two types of trading interfaces – one for beginners and another one for pro traders, a highly secure Coinbase wallet, user-friendly Coinbase mobile app, educational platform, great customer support, multiple popular payment methods, and a strong selection of cryptos.
There are more than 400 crypto exchanges on the market and many of these platforms aren’t trustworthy enough because they lack proper regulations. Coinbase, on the other hand, is fully regulated, which means it operates in accordance with financial and tax laws in the regions where the platform provides its services. Many crypto exchanges don’t have regulatory licenses for operating in the US but Coinbase is one of the rare exceptions because it’s legally allowed to operate in almost all US states.
During the years, Coinbase has made a name for itself on the crypto market and today it has over 68 million verified users from more than 100 countries and regions in the world and a quarterly trading volume of more than 300 billion USD. In 2021, Coinbase also became the first crypto exchange platform to list its stocks on the NASDAQ stock exchange.
A smooth user experience is very important for large crypto exchanges because these platforms mainly count on average crypto traders and investors who aren’t used to complicated trading interfaces. The Coinbase platform excels in this aspect because the trading interface is so simple and straightforward that a total beginner with no crypto exchange experience could easily buy or exchange cryptos in a few minutes.
All the basic trading tools are at your disposal on a single screen and once you connect an approved payment method, you can easily place a purchase order for any available digital currency. Once you submit a purchase order, the bought cryptos will be transferred to your Coinbase account in a matter of minutes. If you have a Coinbase Wallet, you can connect it to your exchange platform account and have your purchased cryptos directly sent to your wallet. This way, you can avoid any extra fees for transferring assets from Coinbase to a third-party crypto wallet.
In case you want to exchange cryptos, you just need to find the appropriate trading pair and initiate an exchange. The trading interface also shows a simple market chart for each trading pair or selected cryptocurrency, so you can monitor the price fluctuations of your chosen assets with ease.
Since Coinbase is a fiat-friendly crypto exchange, you can use it to cash out your cryptos into fiat money. You can do this by selling your coins for fiat currency, directly from the Coinbase trading interface. When you sell your coins or tokens, you can directly send the fiat cash to your bank account.
While the Coinbase trading interface is ideal for beginners and intermediate traders, it lacks many advanced order types and trading features. This is why there’s a separate Coinbase Pro platform, with various options geared towards pro traders and investors who want to have access to more complex trading tools. The platform was formerly known as GDAX before it got rebranded to Coinbase Pro.
Traders have access to detailed market charts that can help them plan and implement complex trading strategies based on real-time market fluctuation. Also, there are various advanced market report features on Coinbase Pro, which can help experienced traders in making the right decisions. This platform favours active day traders with high trading volumes and rewards serious traders with lower fees compared to the basic Coinbase platform.
Coinbase fees can be a deal-breaker for some users because the platform is known to have some of the highest fees on the market. Even so, the fees aren’t really too high, they are just higher compared to many popular exchanges, but the quality of Coinbase services is also much higher than that of competitor platforms.
The fact that you can easily buy cryptocurrency with a bank account transfer, debit card, or credit card, is a convenience worth the somewhat higher fees.
The fee structure includes several factors. You pay one fee based on the payment method you’re using and another platform fee based on the chosen crypto spread. The standard spread fee is around 0.5 % per transaction, but it may vary depending on market circumstances.
If you buy cryptos with a US bank account transfer or through funds in your Coinbase Wallet, you’ll incur a 1.49% fee. Debit card purchases incur a 3.99% fee, which makes buying cryptos with a debit card a bit expensive. ACH bank transfers are free of charge, while wire transfers are charged 10 USD for purchases and 25 USD if you’re cashing out cryptos and transferring cash to your bank account. Instant card withdrawals are charged up to 1.5%.
The Coinbase Pro platform uses a standard maker and taker fee model, which awards market makers with lower fees, while market takers incur somewhat higher fees. Fees are based on the 30-day trading volume.
For example, market takers with a monthly trading volume of up to 50,000 USD incur a platform fee of 0.50%, but the fee can drop down to 0.15% if the trading volume gets between 50 and 100 million USD. Market makers get the same starting fee of 0.50%, but their fee can drop to 0.05% for a monthly trading volume of at least 50 million USD.
Bitcoin and Other Supported Cryptocurrencies
Fees, security, and the selection of supported cryptocurrencies are some of the key factors you should pay attention to when choosing a crypto exchange platform. Coinbase offers a strong selection of top trending coins and tokens. You might not be able to find hundreds of highly volatile, low cap tokens, but you’ll definitely find all the most popular crypto assets and you’ll be able to buy them directly with fiat currency such as USD, GBP, and EUR.
Coinbase supports over 50 of the most popular cryptocurrencies including Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ethereum Classic (ETC), Litecoin (LTC), Tether (USDT), Binance Coin (BNB), Solana (SOL), Cardano (ADA), Ripple (XRP), USD Coin (USDC), Dogecoin (DOGE), Avalanche (AVAX), Polygon (MATIC), Algorand (ALGO), Tron (TRX), Stellar Lumens (XLM) and other popular altcoins.
Every crypto that’s available for trading on Coinbase needs to go through a rigorous regulation process first. That’s why Coinbase doesn’t have a much larger selection of cryptos like Binance, which is an unregulated exchange.
Users can enjoy various popular payment methods available on Coinbase. You can use your US bank account for direct purchase with a bank transfer or ACH transaction. In case you have an EU bank account, you can facilitate payment through a standard SEPA bank transfer. In any case, in order to add a bank account as a payment method to your Coinbase account, you need to get your bank account verified by Coinbase first.
You can use several online payment services to purchase cryptocurrency on Coinbase, including PayPal, Google Pay, and Apple Pay. This is a quite convenient method if these services are available in your region because they are faster than classic bank transfers or wire transfers.
Debit cards are also a legitimate payment method on Coinbase. The fees are somewhat higher compared to other payment methods, but the payment process is really fast and you’ll have your cryptocurrency delivered to your wallet almost instantly.
Bank Account Verification Process
Using a bank account to purchase cryptos on Coinbase is a very reliable payment method, even though it’s a bit slower compared to debit card purchases. The upside to using a bank account is that the fees are lower than using an online payment service or a debit card. Before you can connect a bank account, you need to go through the KYC (Know Your Customer) procedure and provide your full name, phone number, and provide photo ID verification.
The bank account verification process is very straightforward. Just follow this simple tutorial to connect and verify your bank account on Coinbase:
- Go to the Payment Methods page in your Coinbase account.
- Select Add a Payment Method and then choose Bank Account.
- After you click on Continue, you’ll see a selection of popular bank logos.
- In case you don’t see your bank’s logo, scroll down and select the Don’t see your bank? Search instead option.
- If your bank can’t be found through the search option, you can manually add your bank details through the Link bank manually button.
- Choose the Get Started option and fill in your bank’s details. The necessary information includes your bank account number, the bank’s routing number, account type and name associated with the bank account. The name has to be identical to the name you provided when registering for a Coinbase account.
- Once you’ve entered all the required details, click Verify Account.
- This will initiate two small test transactions of cash in order to make sure the bank account is connected. It usually takes 1-3 business days for the transactions to get processed and when the procedure is finished, you can select the Verify option for your bank account, under the Payment Methods section of your Coinbase account.
- Now you can purchase cryptos on Coinbase with your verified bank account, and you can also use it to receive fiat currency from selling cryptos on Coinbase.
Coinbase takes security very seriously. Almost all of the funds (98%) exchanged on the platform are kept offline in cold storage. The rest (2%) is kept online in order to provide liquidity for the platform. This means that even in case a cyber attacker managed to hack the exchange, only a minor portion of user assets would be jeopardized. Even in the case of a successful cyber attack, you still won’t lose any money, because the online assets are insured by Coinbase and the platform will reimburse any potential losses to their users. If you choose to store fiat USD in your Coinbase Wallet, the cash is insured up to 250,000 USD per user account.
As far as transaction verification, Coinbase uses two-factor authentication (2FA) to help users protect their accounts. You can also set an email or SMS confirmation protocol for every single transaction.
Coinbase Earn is a great way to get some free cryptos while learning about cryptocurrencies. It’s a section of the Coinbase website that includes educational videos about a bunch of different digital currencies. Once you watch a series of videos, you can start a crypto quiz, with questions regarding the videos. If you answer correctly, you’ll be rewarded with a small number of cryptos. The awards are always given in the tokens that the videos are about.
Most crypto traders want to be able to manage their portfolios while on the move. That’s why all reputable crypto exchanges launch their own mobile app platform versions. The thing with the Coinbase mobile app is that it’s super easy to use, with a simplistic user interface, just like the browser version of the platform. The app is called Coinbase: Buy Bitcoin, Ethereum, SHIB, Bitcoin Cash and it’s available for both Android and iOS smartphone users.
Traders who decided to use the mobile app version of the platform won’t lose access to any Coinbase features, because everything that’s available online through your browser is also available in the app.
The Coinbase Wallet is one of the platform’s features that make it a complete cryptocurrency ecosystem because you can buy, sell, exchange, and store your assets safely, without having to utilize third-party apps. Coinbase Wallet is a non-custodial wallet, which means that your private keys aren’t stored on the wallet servers or Coinbase platform servers. Instead, private keys are always kept on the device you’re using to run the Coinbase Wallet.
This is considered quite secure if you’re careful not to click on suspicious links because if someone manages to access your device remotely through a phishing attack or other malicious software, they might get hold of your private keys.
You can directly exchange stored cryptos on the Coinbase platform without leaving your Coinbase Wallet, and the wallet also has built-in buy/sell features. Coinbase is constantly expanding the number of supported coins and tokens in their wallet. Currently, it supports more than 4,000 assets, and you can access various useful decentralized apps through the wallet. If you’re looking to store NFTs, Coinbase even has NFT storage capacities.
In case you have some issues with the platform, there’s a very detailed Help section on the website, with lots of explanations for the most frequent user issues. If you don’t manage to find the answer to your problem there, you can contact Coinbase support through their Twitter account, email or even make a request for a telephone call to talk to a Coinbase support team member.
The team responds quite rapidly to all user questions and problems, so it’s not like you’ll be waiting for days to get an answer. The average response time is a few hours.
A Few Ending Words…
The wide range of top-quality services is something that’s definitely worth the somewhat higher Coinbase fees. Sure, there are dozens of crypto exchanges with much lower fees, but their platform security is also much lower and they don’t provide as many services as Coinbase.
Being able to connect your bank account and purchase cryptos with fiat money is a convenience which many exchanges don’t offer. Not to mention the fact that you can sell your coins on Coinbase and cash out into fiat money with just a few clicks, by sending the cash straight to your linked bank account.