What is Coinbase?
admin,June 14, 2018
Coinbase, located in San Francisco, California, is one of the popular Crypto Exchanges among the Crypto trader and investor. It has a user-friendly and complete feature with a hybrid service on the platform for the crypto trader or investor to buy or sell any famous crypto coins, such as Bitcoin, Ethereum, LiteCoin, and Bitcoin Cash.
How Coinbase systems work
Coinbase actually has two main products:
- Coinbase – for people buy and sell Bitcoin, Ethereum, LiteCoin, and Bitcoin Cash with Fiat Currency.
- GDAX – more like a traditional exchange for customers to trade those top currencies.
Due to its rich and friendly feature, Coinbase has become the most recommended digital asset exchange for new crypto trader or investor. However, it would be best to join the GDAX site also, as both Coinbase and GDAX use the same login site.
Coinbase an is an intermediary platform for you to trade cryptocurrency through blockchain. There is no pseudo anonymity – your account and bank account is easy to track down, so you are putting trust in Coinbase in verifying your transaction or your account as it is taking place in the blockchain.
Buying and Selling Cryptocurrency
You purchase or sell cryptocurrency at the specified price with your local currency. Before purchasing cryptocurrencies, Coinbase requires you to link your bank account or credit or debit card to your Coinbase account, this payment process has its advantages and weaknesses:
- Bank Account
Deposit your Coinbase wallet using your bank account will benefit you by having a higher limit: $100/transaction, $2500/week. However, it takes longer to process and verify the transactions, around 2-4 work days. Vice versa when you sell the cryptocurrencies.
- Credit/Debit Card
While with Credit or Debit Card, the transaction process is done instantly. However, your limit is only $200/week. Your digital asset purchasing will be much easier and fast.
- Paypal Account
You can also sell your Cryptocoin, like Bitcoin with your Paypal account. The transaction process for Paypal is instantaneous too.
The Gif image below outlines the process of buying and selling Bitcoin on Coinbase. It’s very simple!
Fee transaction in Coinbase is charged in both activities, buying and selling. The rates are different in every country and payment method. In the United States, the base transaction rate is 4% with various additional percentages. You can see here for more detail information of Coinbase fee. Instant transactions charge a higher fee rate.
How Coinbase protects clients’ funds
Coinbase ensures clients’ data and funds are protected and safe from any threat or hijacking. They store clients’ fund 98% offline, assuring the customer that “sensitive data that would normally reside on our servers is disconnected entirely from the internet”. The data is encrypted, moved onto the USB drive and paper backups.
Despite its advantages, be prepared for any hurdles that could appear in Coinbase. One of them is the slow process of Blockchain verification because Blockchain works by verifying transaction history. Example: You sell Bitcoin. While waiting for the verification process by Blockchain, the Bitcoin price changes, so the sale won’t proceed. Then you have to sell your Bitcoin in any new rates (if you choose to sell).
Besides learning how to gain a return in Cryptocurrencies, it is best to be prepared and learn about the intermediary platform which will affect your trading success.