What is Coinbase? Basic Knowledge Before Investing and Comparing the Differences Between Coinbase and Binance

What is Coinbase? A name that may seem all too familiar in the crypto market, yet it still attracts over 1,000 monthly searches. If you’re still unsure about what exactly Coinbase is, the features it offers like Coinbase Exchange, Coinbase Wallet, Coinbase Ventures… or how to earn through Coinbase Earn, along with rumors surrounding Coinbase crashes, Coinbase hacks, or whether Coinbase is a scam—then this guide on how to use Coinbase will equip you with all that knowledge.

1. WHAT IS COINBASE?

Coinbase is one of the oldest cryptocurrency exchanges in the U.S. and ranks among the largest crypto platforms globally. It is a secure online platform to buy, sell, trade, and store digital currencies. Launched with the mission to create an open financial system, Coinbase aims to become a global financial brand.

When talking about a trading platform with a simple, user-friendly interface, Coinbase quickly comes to mind. However, its reach doesn’t stop at beginners—Coinbase continues to develop features suited for professionals and advanced traders as well.

1.1. Development Team and Coinbase Founder

Coinbase Global, Inc. was founded in mid-2012 by Brian Armstrong and Fred Ehrsam. Brian was an engineer at Airbnb, while Fred was a trader at Goldman Sachs—one of the world’s top investment firms. Another co-founder, Ben Reeves, a British programmer, was involved early on but left due to disagreements over Coinbase Wallet just before the Y Combinator funding event.

The executive team comprises 7 members, and the board of directors has 8. Brian is the only person involved in both groups. As of now, Coinbase has nearly 4,000 employees.

1.2. Which Country is Coinbase From?

Coinbase is a product of Coinbase Global Inc., a U.S.-based company. Through Y Combinator, Armstrong secured $150,000 in seed funding. In October 2012, Coinbase launched Bitcoin trading via bank transfers. Within a year, Coinbase secured additional funding—$5 million in Series A from Union Square Ventures and $25 million from Ribbit Capital, Andreessen Horowitz, and Union Square Ventures by the end of 2013.

By 2014, Coinbase expanded its partner network to include Dell, Dish Network, and Time Inc., enabling these companies to accept Bitcoin payments. That same year, Coinbase integrated Bitcoin payments with major traditional payment processors like Stripe, PayPal, and Braintree. In early 2015, Coinbase secured a $75 million investment from USAA, the NYSE, and other financial institutions.

Due to the COVID-19 pandemic, Coinbase transitioned to a remote-first model in May 2020, closing its physical headquarters. Later, due to the Russia-Ukraine war, Coinbase blocked 25,000 crypto wallets linked to Russia.

1.3. Coinbase Crash Incident

In early 2022, Coinbase launched a Super Bowl ad campaign—an annual American football event running since 1967. The campaign, titled “Less talk, more Bitcoin,” featured a 60-second ad with only a color-shifting QR code on a black screen.

Scanning the QR code redirected users to Coinbase’s website offering $15 in free Bitcoin to new signups and entry into a $1 million Bitcoin sweepstakes. The traffic surge—estimated at 20 million visits in one minute—crashed the Coinbase website. The Coinbase app then ranked #2 in download charts after the ad aired.

2. PRODUCTS OFFERED BY COINBASE

Coinbase offers a wide variety of features, but its three core products are:

• Crypto Brokerage Services for individuals
• Coinbase Pro Exchange
• Coinbase Prime for institutions and enterprises

To use these features, users must register an account. Signing up on Coinbase is simple. On the homepage, click “Sign In” at the top right. If you don’t have an account, select “Create Account” and fill in:

• First Name
• Last Name
• Email
• Password (minimum 8 characters)

Agree to Coinbase’s terms and click “Create free account.” Follow the instructions in the confirmation email to verify your account.

2.1. What is Coinbase Exchange?

Currently, Coinbase supports over 150 coins and 450 trading pairs. The minimum transaction value is $2. The fee structure is complex, calculated based on:

• Spread between buy and sell price (~0.5%)
• Payment method, order size, market conditions like volatility and liquidity
• Network fees for blockchain transactions

Fees differ between Coinbase and Coinbase Pro, with the latter offering a simpler fee structure.

2.2. What is the Coinbase Wallet?

Not only does Coinbase develop an exchange, it also provides its own version of a cryptocurrency wallet to store coins. The coinbase wallet is secured by a password, biometric access control such as fingerprints. At the same time, similar to other coin wallets, the coinbase wallet also provides users with 12 words to encrypt and ensure the safety of your assets.

Coinbase Wallet Features:

• Two-Factor Authentication 2FA: To ensure your safety when accessing your wallet, Coinbase offers 2FA authentication via text message to your phone number or the Google Authenticator app.

• Cold Storage: Coinbase is one of the few exchanges that stores about 98% of all cryptocurrencies in “cold storage” a concept similar to a cold wallet, meaning your assets are stored offline. Additionally, to prevent fraudulent withdrawals, Coinbase also offers a “crypto vault”. That cryptocurrency will be locked, requiring multiple approvals within 24 hours to be withdrawn.
• FDIC Insurance: Typically, deposit insurance is more common in banks. Note that the FDIC insurance that Coinbase supports will not apply to your investments, but only to the dollar. Losses in trading will not be covered.

Coinbase wallet has both app and web extension. How to create a coinbase wallet on your phone or how to use coinbase wallet is guided in detail on the website.

2.3. What is Coinbase Pro?

The upgraded version of Coinbase exchange is Coinbase Pro which has been mentioned many times from the beginning of the article. If new traders prefer the simplicity of Coinbase exchange, professional traders appreciate the advanced features of Coinbase Pro exchange more.

Coinbase Pro also supports fiat currencies similar to Coinbase exchange. However, the number of coins supported by Coinbase Pro is more. In terms of security, there is almost no difference between these two exchange products. In addition, Coinbase Pro’s fee structure will be based on levels or in other words, the frequency of your transactions. For example:

• Trades under $10,000: 0.50% taker/maker fee
• $10,000 – $50,000: 0.35% taker/maker
• $50,000 – $100,000: 0.25%
• $100,000 – $1,000,000: 0.20%

Lower fees and no deposit method charges make Coinbase Pro suitable for high-frequency traders.

2.4. What is Coinbase Ventures? What is Coinbase Ventures Portfolio?

Coinbase Venture is a branch of Coinbase founded in 2018 with the purpose of investing in startups in the blockchain and crypto industry in the early stages. Coinbase Ventures Portfolio is an investment portfolio of Coinbase Ventures including a variety of projects from NFT, Lending, Cryptocurrency Wallet, … in the decentralized financial market.

As of June 2022, Coinbase Ventures has made over 300 investments. You can explore the Coinbase Portfolio [HERE].

2.5. What is Coinbase Custody?

Launched in 2018, Coinbase Custody allows institutions and funds to securely store crypto under Coinbase supervision. It is a New York State-chartered trust company operating independently. Some supported assets also enable staking or governance participation.

2.6. Earn Money with Coinbase Earn

Coinbase Earn rewards users for watching short crypto-related videos and completing quizzes. In return, users earn crypto.

Requirements:

• Identity and photo verification
• Not residing in restricted countries
• Only one verified Coinbase account

2.7. Coinbase NFT Marketplace

First introduced in October 2021 and running until April 2024, the Coinbase NFT Marketplace is now live in beta and is invite-only. The Coinbase NFT Marketplace allows you to create NFTs, earn income from NFTs, and connect with like-minded people.

3. HISTORICAL MILESTONE – COINBASE IPO

In April 2021, Coinbase became the first U.S. crypto exchange to go public on Nasdaq. Its opening stock price was $381, valuing the company at around $100 billion. This IPO reflected Coinbase’s financial and organizational transparency required for listing on major exchanges.

4. COINBASE VS. BINANCE

Coinbase and Binance can be considered the two most famous and largest cryptocurrency exchanges today. So it is inevitable that there will always be a comparison between these two trading platforms. Some factors and criteria have been “put on the scale” to compare Coinbase and Binance:

• Liquidity: Both exchanges have a large amount of liquidity in the market. So traders do not need to worry too much about whether large orders will be executed or not.
• Support: Currently, Coinbase does not support Vietnam, but Binance does. That is why Binance is so popular in Vietnam.
• Exchange listing: The answer to the question of what is a coinbase list is similar to other exchanges. Most projects want to be listed on Coinbase or Binance because the price increases sharply immediately after listing. However, it is also impossible to make a definitive assessment of a coin or token of a project listed on one or two of these exchanges.

Ultimately, choosing between Coinbase and Binance depends on personal preferences and trading needs.

5. CONCLUSION

This guide on “What is Coinbase” provides a comprehensive look into Coinbase, Coinbase Pro, and how to use the platform. Currently, Vietnam is not on the list of countries supported by Coinbase due to U.S. regulatory constraints. Many other nations are in a similar position. Hopefully, Coinbase will expand access globally in the future.