Coinbase is our pick for best crypto exchange for beginners because it offers a large number of supported cryptocurrencies, strong security, and advanced trading capabilities, all on an easy-to-use platform.
Coinbase was founded in 2012 to enable people to seamlessly buy, sell, and store Bitcoin. Fast-forward to today and Coinbase is a publicly traded cryptocurrency exchange with a total market value of over $38.5 billion.
The originally San Francisco-based crypto exchange is now a geographically decentralized company with no headquarters and available in 100+ countries. It stands out for providing a user-friendly trading experience, robust security, and a range of advanced features for experienced traders.
Because of its large number of supported assets (300+) and easy-to-use platform, Coinbase has become the go-to exchange for many first-time crypto buyers. The platform has the look and feel of an online banking app, which most people are using already, making the transition to crypto investing simple.
Coinbase also insures the digital funds it holds on behalf of users and stores U.S. dollar balances in Federal Deposit Insurance Corporation (FDIC)-insured bank accounts to prevent a loss of user funds in the case of a security breach. Trading accounts can be funded with a wide range of payment methods, including wire transfer and ACH transfer.
What’s more, Coinbase also offers options for storing crypto. The first is a custodial option for new investors: storing your coins on the Coinbase.com exchange. The second is a non-custodial wallet (Coinbase Wallet) for experienced crypto users. When storing your crypto on Coinbase.com, Coinbase holds the private keys and effectively stores funds on behalf of Coinbase.com users. With Coinbase Wallet, the user has complete control over their funds as they hold the wallet’s private keys.
While Coinbase is a suitable digital asset exchange for both new and advanced crypto investors, trading fees can be relatively high, ranging from 0% to 0.60% depending on trade volume. In addition, Coinbase’s user feedback is relatively poor. For instance, several Trustpilot users mention problems with customer support. Additionally, there are numerous stories of unexpected account closures that have tainted the exchange’s image.
Moreover, Coinbase has been charged by the U.S. Securities and Exchange Commission (SEC) for allegedly operating as an unregistered securities exchange. SEC Chair Gary Gensler claims that “Coinbase, despite being subject to the securities laws, commingled and unlawfully offered exchange, broker-dealer, and clearinghouse functions.”
Coinbase has been in communication with the SEC for years in an attempt to ascertain how to comply with regulations to prevent fines. Unfortunately, without success, resulting in the current charges for the U.S.-based company.
Despite the exchange’s drawbacks and the current charges by the SEC, Coinbase is still worth considering due to its ease-of-use.
