As the world’s largest cryptocurrency exchange, Coinbase has been at the forefront of the digital asset industry since its launch in 2012. In recent years, the San Francisco-based company has made a number of high-profile acquisitions and integrations in an effort to further its mission of making crypto assets accessible to everyone.
One of the most notable aspects of Coinbase’s business model is its focus on compliance with local regulations. This has led the company to be one of the few digital currency businesses to obtain licenses to operate in multiple US states.
Coinbase is also registered as a Money Services Business with FinCEN in the US.
Another key differentiator for Coinbase is its customer base. The vast majority of its users are retail investors, whereas most other exchanges cater to more sophisticated traders and investors.
This focus on simplicity has helped Coinbase attract millions of users from around the world.
In terms of technology, Coinbase has built a number of features into its platform to make it more user-friendly. For example, the company offers a “Coinbase Vault” service that allows customers to store their cryptocurrencies offline in order to protect them from hacks and thefts.
Additionally, Coinbase supports a number of popular altcoins, such as Ethereum and Litecoin, in addition to Bitcoin.
Coinbase has also made a number of strategic partnerships with traditional financial institutions. In 2018, the company partnered with Visa to launch the first crypto-backed debit card in the US.
This partnership allows Coinbase users to spend their cryptocurrencies anywhere that Visa is accepted. Additionally, Coinbase has partnered with banks such as Barclays and Cross River Bank in order to offer crypto-backed loans to its customers.
One area where Coinbase has been criticized is its fee structure. The company charges a 1% fee for all transactions, which is higher than many other exchanges. Additionally, Coinbase imposes a “spread” on all trades, meaning that buyers and sellers are not getting the same price for their assets.
For example, at the time of writing this article, the “Coinbase Pro” exchange was offering Bitcoin for $10,700 while simultaneously selling it for $10,800. This 4% difference is significantly higher than what is typically seen on other exchanges.
Despite its criticisms, Coinbase remains one of the most popular cryptocurrency exchanges in operation today. The company’s focus on compliance and simplicity have helped it attract millions of users from around the world.
Additionally, its strategic partnerships with traditional financial institutions give it a level of legitimacy that many other exchanges lack. While its fees are high relative to other exchanges, they are still lower than those charged by traditional financial institutions such as banks or credit card companies. Overall, Coinbase is a decent choice for those looking for a reliable and user-friendly option when it comes to buying and selling cryptocurrencies.