Many people are asking, is Coinbase safe as it is getting the attention of newbies in the industry as one of the largest and most trusted cryptocurrency exchanges. With over 46,000 people reporting a loss of $1 billion in crypto to scams, it’s no surprise that many tread this road with due diligence. And looking for the most secure platform is at the top of their priorities. Let’s learn what Coinbase is and if it’s safe to use.
What is Coinbase?
An online platform for selling, buying, transferring, and storing cryptocurrency, Coinbase is also one of the most popular. Its trading volume and long-established reputation for safety and security are unmatched.
Founded in 2012 by Brian Armstrong, the current CEO, Coinbase Global Inc. has no headquarters to speak of. Instead, all its employees, all 3,730 of them as of 2021, work remotely. Its stocks are now listed on Nasdaq under the COIN crypto. The company has approximately 73 million users, a $3.62 billion net income, and around $21.3 billion in total assets.
Coinbase lets its users buy and sell a wide array of cryptocurrencies such as Bitcoin, Ethereum, USD, Cardano, Litecoin, Dogecoin, and many more. You can also use the platform to convert one cryptocurrency to another. In addition, you can use Coinbase to send and receive cryptocurrencies from other people.
How to Buy and Sell on Coinbase?
One of the best things about Coinbase is that they made their trading processes easy. The learning curve is pretty low, making it an excellent choice for novices. Here’s what you should do to buy and sell on Coinbase:
- First, you must download the Coinbase app on your Android or iOS phone.
- Open the app and tap “Get Started.”
- Create your account and tap “Start.” For federal regulations compliance, you will need to enter your email address and other information such as your home address and date of birth.
- Verify your email address. You need to check your email to tap on the link that Coinbase sent you.
- Verify your phone number via a texted code.
- You will then be prompted to input your details.
- Choose how you will use Coinbase (investing, online payments, or other exchanges).
- Confirm your source of income.
- Tap “Let’s Go.”
- Link your bank account by going through the instructions that follow.
Now that you’re all set up, it’s time to learn how to buy and sell cryptocurrencies on Coinbase. Here are the steps you need to follow:
To Sell on Coinbase:
- Tap “Get Started.”
- Choose the cryptocurrency you want to buy from the list you’ll see.
- Select how much you want to buy. Note that you can purchase in fractions, which means that you don’t have to buy one whole Bitcoin. You can start by buying $5 worth or how much you want. You’ll get the corresponding amount of the cryptocurrency depending on its current market value.
- The minimum order is pegged at $2 of the digital currency denominated in your local currency.
- Tap “Preview buy.”
- Review your order. Note that Coinbase will take a cut from your purchase, so be guided accordingly.
- Choose “Buy now.”
To Buy on Coinbase:
- Tap the blue icon on the main page. You’ll find two arrows.
- Select Sell.
- Choose the digital asset you want to sell.
- Choose how much you want to sell.
- You have the option to select the “Max” button if you’re going to sell all your cryptocurrencies at once.
- Review your asset. Again, take note of the Coinbase fee you need to pay for this transaction.
- Tap “Sell now.”
How to Withdraw Money from Coinbase
- Go to your portfolio and tap on it.
- Choose your currency from the options provided.
- Tap “Withdraw.”
- Choose “Preview withdraw.”
- Choose your bank account. You can also select to add a debit card if you’re not willing to wait the transfer time of three business days.
Is Coinbase Safe?
According to Coinbase, all its customer deposits are insured, thereby proving its security. However, the company isn’t protected by the Federal Deposit Insurance Corporation or the SIPC. This means that your assets are not insured in case Coinbase fails. To compensate for this, Coinbase uses cold storage (offline wallets) to store its assets, meaning they will not be accessible via the internet.
Other proofs that Coinbase is safe are its billions of digital assets, its usage in over 100 countries globally, and its millions of users. Moreover, it’s reassuring to know that Coinbase doesn’t rely on these for its safety. It has enforced security measures to give peace of mind to its users.
To prevent users from falling victims to thefts, scammers, and hacking, Coinbase has adopted security measures such as 2-factor authentication. It uses phone, email, biometrics, and fingerprint logins to secure your account.
Tips To Trade Safely in Coinbase
Like any other trading platform, you must be cautious to avoid getting defrauded. Here are a few tips that can help you:
- Don’t fall victim to FOMO and FUD – FOMO (Fear of Missing Out) and FUD (fear, uncertainty, and doubt) can influence us to buy urgently without thinking, do not fall prey to these.
- Trade within your means – set your goals before making that big spend. Whether stocks or cryptos, seasoned traders will tell you never to invest more than you can afford to lose.
- Don’t be afraid to HODL – cryptocurrency prices are volatile. They can go up or down and could mean a loss on your part if not played with careful thinking. HODLing (holding on for dear life) for more extended periods has been proven beneficial.
Aside from the proofs above, Coinbase has received many positive feedback ratings on review platforms. Also, its time in the industry makes it one, if not the most trusted exchange platform. That said, it’s still up to the user to take reasonable steps to ensure their assets’ safety and security. Overall, to answer the question, is Coinbase safe? It is.