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Coinbase

Coinbase Review
Trader's rating 2.8
Editor's rating 4.1

Our Experience

 

When testing the direct purchasing service, provided by Coinbase, we were relatively satisfied. After entering our debit card details it was saved as a payment method. We must notе that our card was 3D-secured, which appears to be a mandatory condition. Having your card stored in the website, as opposed to having to enter the details a second time (which is the case with some websites, dealing with external payment providers) is a huge benefit.

 

Here is a preview of the order screen:

The commission charged was slightly lower than the maximum of 4%, and we had full price transparency. When compared to the 8%, charged by Bitstamp (for direct card purchases), this is obviously preferable. The rate at which we bought Bitcoin was around €14 off the current market price, at GDAX. This is quite reasonable considering the fact we are talking about a volatile asset, trading around  €6,500 at the time of purchase. We tried comparing it with the rate provided by other exchanges, but the price differences (especially since we are talking about EUR trading) were much wider.

 

Trading Accounts

 

 

Account type Initial weekly limit Leverage Fees
Standard €325 None Up to 4%

 

Coinbase is one of the leading US companies in the world of crypto currencies. It operates two separate brands. One of them is Coinbase, a more retail consumer oriented platform for buying Bitcoin with fiat currencies, much like Bitstamp. On the other hand, GDAX (Global Digital Asset Exchange) is a more advanced crypto currency trading platform. This review will be focused on Coinbase.

 

The company, security of funds

 

Company Country Regulation
Coinbase USA NY BitLicense

 

Coinbase operates out of the US, with many subsidiaries around the world. It was the third company to be awarded the New York BitLicense. The story behind this license is quite controversial. In short, the New York Department of Financial Services (NYDFS) wanted to make the Big Apple a “Bitcoin trading hub”, much how it is one of the major centers of traditional finance. The idea, dating from 2015 wasn’t met with much enthusiasm by the leading companies, as many of them preferred to avoid application. Among the dozen who did, Coinbase obtained the license in January of 2017. The entire process is apparently so time (and effort) consuming, a lot of other major players opted out of it, which makes the license borderline useless. 

 

When it comes to crypto exchanges, hacking is an important topic. That being said there haven’t been any major hacks at Coinbase, although numerous individual cases have been reported. Some involve the hackers going past the two-factor authentication barrier, which one would believe to be very secure.

 

As we mentioned above, Coinbase is the retail-oriented brand of the company. As such it accepts fiat currencies and allows an instant purchase of several coins (more on the list, later). The vast majority of user complaints against Coinbase involve the size of the commission fees which the company charges. They vary by region and payment method, but go as high as 4%.

 

In 2018, Coinbase acquired an e-money license from the Financial Conduct Authority (FCA), which allows it to provide payment services in the UK and issue e-money. Abiding by the FCA requirements, Coinbase will be keeping clients in segregated funds and will observe operational standards on par with the other regulated financial institutions.

 

Additionally, Coinbase is backed by a lot of investors, including major players in “traditional finance”. This is another factor which fans of the decentralized aspect of crypto currencies do not enjoy. 

 

Trading conditions

 

Trading instruments (cryptocurrencies)

Only a few coins are available at Coinbase, but they are the majors – Bitcoin, Ethereum and Litecoin. Don’t forget this is an entry-level service, which is aimed at people who are not that familiar with the world of crypto currencies. If you would like to buy less known coins (or altcoins), you could do that at another exchange, after transferring your newly acquired BTC/ETH/LTC there.

 

Weekly Limits

After verifying your e-mail, telephone, ID and credit card, at Coinbase, you can beginning purchasing coins. Our initial limit was €325 per week (via Credit Card). This may vary for you, based on your location (US clients will surely get a USD level). This level can be increased after you reach the maximum and some time has passed. This is done as a security measure and one should not feel frustrated about it.

 

Leverage

Coinbase does not offer margin trading. This is the more accepted practice, when dealing with crypto currencies. The forex brokers who offer Bitcoin trading, on the other hand mostly provide CFDs on it and margin trading is allowed. For a full comparison of trading crypto currencies on an exchange and with a forex broker read this post

 

Fees

The commission structure at Coinbase is one of its criticisms. If you decide to deposit via Credit Card, for instance, you can buy your chosen coin directly. While this may appear to be convenient, it comes at a price – for most countries the commission fee on such a purchase can go as high as 4%. 

 

Alternatively, you can fund your account with fiat currencies, which you can then use to trade. In that case the fees are set at 1.5%, which is pretty high. However if trading is what you are looking for, the company’s other brand – GDAX (as well as many others) are alternatives.

 


Trading platform

 

Coinbase does not provide a platform, as much as it offers an interface similar to an online banking application. Here is an overview (click to zoom-in):

 

 

There is a basic chart in the top section, allowing you to switch between the three supported instruments and multiple timeframes. On the bottom you have a column with all of your wallets with the company as well as a transaction history column. Overall, it doesn’t get any simpler than this. That being the case, we must reiterate, this is only the “real-money payments” brand of the company, while a more dedicated platform is also available at GDAX.

 

Methods of payment

 

When it comes to the methods of payment available at Coinbase, they include Bank Transfer, Credit/Debit Card and PayPal (only for US clients). While we discussed the transaction fees above, it’s worth pointing out that no additional fees are charged for crypto currency transfers to other exchanges or wallets.

 

Conclusion

 

Coinbase is one of the major players in the crypto currency space. The company is focused on allowing people who are not familiar with Bitcoin and allows them an easy way of acquiring crypto currencies. While there isn’t any trading platform to speak of, the company has another brand (GDAX) which provides exactly that. We feel it would be much better for Coinbase to honestly state their trading fees are higher, but you can use your account at their other platform, in a big banner upon account cration. Here are Coinbase’s pros and cons: 

 

Pros

Cons

New York BitLicense Few altcoins available
No major hacks yet High trading fees
Accepts Bank Transfers and Credit Cards  
Easy to use interface  
Ability to transfer crpyto to wallet  

 

KorBit

KorBit Review
Trader's rating 1
Editor's rating 3.8

Trading Accounts

 

Account type Leverage Maker Fee Taker fee Deposit Fee
Standard N/A Max 0.08% Max 0.20% Free

 

KorBit was the first Korean cryptocurrency exchange to offer BTC/KRW trading. They are an entry-level service (i.e. accept fiat currencies) but also offer a decent trading platform. The company is still one of the top-rated exchanges in the country, which drives relatively high trading volumes.

 

KorBit Advantages

 

Competitive fees –   The trading fees at KorBit are divided into the “maker” and “taker” category. Market makers are the traders who place a new entry in the order book, while takers are those who enter at the best available price. The fees at KorBit start from 0.08% and 0.20%, respectively. They can go even lower if you trade with bigger volumes. 

 

Cold storage – KorBit claims a majority of the coins they keep are kept in cold storage. This is a measure, applied by a lot of companies and drastically increases the security of wallets.

 

Several altcoins featured  – There are some alternative coins available at KorBit, but this is by no means the main benefit of the exchange (as is the case with Poloniex or Bittrex). The full list currently includes: Bitcoin, Bitcoin Cash, Ethereum, Ethereum Calassic, Ripple, Litecoin, Dash, Zcash, Monero, Augur and Steem. They are all traded against KWR.

 

KRW bank transfers accepted – Bank transfers from Korean banks are accepted at KorBit. More importantly, the company does not charge fees on any incoming transactions (although the banks involved in the process will). 

 

>> Purchase Bitcoin with a credit card<<

 

Credit cards are a much more preferable option for some users, although the commissions involved in the process can be pretty harsh. As an example Bitsatmp charges 8% on such transactions. 

 

 

Positive user feedback – While the non-Korean reviews of this exchange are relatively few in number, they are all positive. The company seems to operating legitimately, and with the competitive fee structure, most customers should be happy.

 

Nice trading platform – The web-based platform delivered by KorBit looks solid. Charting is provided by TradingView, which is always nice. Additionally the order book and tape (trading history), which are located below the chart also seem well-designed. Her is how they look: 

 

BTC/KRW chart. While the default template is simplistic it can easily be changed via the TradingView package.

 

The easy to read order book and tape.

 

KorBit Disadvantages

 

 

Focus on Korea – The issue, which a lot of locally focused exchanges have is also present at KorBit. They accept only Korean bank transfers and likely require such an account for the verification of your main trading account. The presentation in English, while not terrible is also not ideal.

 

 

Trading against KWR –  All of the trading activity at KorBit is done against the Korean Won (KWR). This may seem nice for local clients, but limits their ability for currency diversification and the option of quickly converting one coin into another.

 

Withdrawal fees – KorBit applies fees on withdrawals. They may not seem significant, but especially the ones imposed on blockchain transfers are annoying. Here is the list which also states all deposits are free of charge:

 

 

No leverage provided  – Margin trading isn’t supported by KorBit, which isn’t that big of a flaw. Cryptocurrencies are so volatile, that most traders don’t have the need to further increase the risks they are exposed to. For those of you who are willing to take even more aggressive steps, we must will recommend trading with as forex broker.

 

>>Leveraged Bitcoin trading brokers<< 

 

That being said, we must also underline the fact this style of trading is not suitable for long term investing. Trading with such brokers is done via the so called CFDs and is very different from going through a crypto-exchange. Read all of the important points here.

 

Conclusion

 

KorBit is one of the oldest cryptocurrency exchanges in Korea. The company has earned a solid reputation and is still very popular. That being said, their main flaw (from our perspective) is the domestic focus of this exchange. While they are not unique in that regard, as other Korean companies, like Coinone and Bithumb also operate in the same manner. 

 

The trading conditions at this exchange are solid – the instrument list features some altcoins, the platform is nice and the fees are up to date with the offers from other exchanges.

 

That being said, when dealing with cryptocurrencies, you must always consider the fact, there will be a certain level of uncertainty. Most veterans in the field would advice you to transfer any larger amounts of coins to a private wallet, whose private keys you control (or even a hardware wallet, like the Trezor or Ledger Nano). With that in mind, the forex brokers, which we mentioned earlier are often much safer alternatives. Click the link below for more details.

 

>>Tightly regulated Bitcoin forex brokers<<

 

And here is the final summary of this exchange (keep in mind, we are viewing it form an outside perspective, as we are not based in Korea):

 

Pros Cons
Competitive Fees Focus on Korea
Cold Storage Trading against KWR
Several altcoins featured Withdrawal fees
KRW bank transfers accepted No leverage provided
No deposit fees  
Positive user feedback  
Nice trading platform   

 

Forex
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