Users requesting crypto transactions have Coinbase attempt to fill their order through its trading platform, Coinbase Pro.Ĭoinbase sets the exchange rate for all crypto transactions, otherwise known as the 'consumer exchange rate.' The company adds a margin, or spread, to the current exchange rate listed by the market.Ĭoinbase also charges users separate fees over the spread, such as a flat fee or a percentage of the transaction value, otherwise known as the 'Coinbase fee.'Ĭoinbase trading fees typically vary based on the user's location, their payment method, and other contributing circumstances. The spread is equal to 0.5% for all crypto purchases and sales through the Coinbase platform.

Buy and sale transactionsĬoinbase charges traders a spread on the buying and selling of cryptocurrencies. The exchange is one of the few regulated options, and it reports transactions to the IRS, unlike deregulated crypto exchanges like Kraken or Binance. How Coinbase makes moneyĬoinbase makes money from the spread on crypto trades made on its platform, transaction fees on the Coinbase debit card, spread when converting to fiat currency, and staking. The most popular are the GDAX and Coinbase platforms, providing crypto traders with direct access to the market and a huge range of pairs to trade, including crypto/USD pairs. The company operates in over 35 countries, providing services across the spectrum of the crypto-sphere.Ĭoinbase, GDAX, Custody, and Toshi are all offered via Coinbase. The company offers traders four primary platforms they can use to manage their cryptocurrency experience. The engineer founded Coinbase in 2011, obtaining development funding from Y Combinator. How does Coinbase work?ĪirBnB engineer, Brian Armstrong, decided to work on Coinbase while he was at AirBnB. The company keeps all its holding in cold wallets, so there's nothing for hackers to steal if they do penetrate the systems.Ĭoinbase offers crypto traders one of the best platforms online for trading.

The exchange also offers traders excellent liquidity, and it has yet to experience any security breaches or other issues. The company's trading interface is slick and smooth, providing traders seamless access to the global cryptocurrency markets. Users have the chance to open accounts and use hot wallets on the platform. The company offers its exchange services through a desktop client and through a mobile app. While Coinbase operates in a decentralized market, the company finds itself a centralized player, acting as a centralized organization, not like a decentralized ledger. It also plays a central role in listing new cryptocurrencies, giving it a similar role for cryptocurrencies as the NYSE or NASDAQ equity markets. Coinbase also acts as a custodian for user funds, similar to a bank. Unlike the other deregulated exchanges, Coinbase allows trading in crypto/fiat pairs, and it also accepts deposits and pays out in fiat currencies like the dollar and Euro.Ĭoinbase earns fees on the charges it produces for allowing users to access the brokerage and the exchange. The company’s platform allows users to buy and sell cryptocurrency. However, stock price aside, the company has an impressive following, with many US and EU-based users. The company launched its IPO in early 2021, with dismal results, falling from its reference price of $250 in the first trading session. Coinbase has a reputation as the world's leading crypto exchange.

Gdax vs coinbase transaction fees