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coinbase

How Does Coinbase Work? Set Your Basics Right!

Coinbase is a secure platform for carrying out transactions like storing, transferring, selling, and buying cryptocurrencies. It’s similar to PayTM or GPay where a financial platform serves as the medium for payments but for the crypto world.

 

So how does Coinbase work to create a secure transaction platform for crypto traders? We have brought to you the A-Z about the transactions on Coinbase and everything in between. Read on to find out how to create a Coinbase account, the trading costs involved, and the reasons for Coinbase being the beginner’s choice.

A Beginner’s Guide to Coinbase

As a beginner, users can find the cryptocurrency web a bit hard to navigate. Well, the first step is to understand the lingo every crypto user must know along with the basics of a regular stock market. Whether you are a new crypto user or just new to Coinbase, here’s how to get started:

Open an Account

There are things you will need to open an account in Coinbase:

 

  • The latest version of the internet browser
  • A phone number for verification
  • A smartphone or a computer with internet
  • An identity card issued by the government such as a state ID or a driver’s license

 

Once you have these in hand, enter the following details in their designated spaces:

 

  • Your first and last name
  • State of residence
  • Email address

 

Now,

  • Create a password with at least a capital letter, a number, a lowercase letter, and a special character.
  • Make sure to select the box to confirm you are above 18 years of age.
  • Add a payment method to move your money into your Coinbase account. US users have the option to add

 

  • Wire transfers
  • Apple Pay
  • PayPal
  • Debit cards
  • Bank accounts

 

That’s it! Your Coinbase account is ready to receive some coins!

Buying on Coinbase

login to your account and follow these steps to start transacting on Coinbase:

 

  • Click the Sell/Buy button at the upper right corner of the home screen.
  • Choose if it’s a one-time, daily, weekly or monthly purchase.
  • Enter the purchase amount.
  • Select the cryptocurrency you want to buy.
  • Choose the payment method.

Selling on Coinbase

Selling crypto on Coinbase is way easier than buying. Simply

 

  • Enter the amount you want to sell.
  • Choose the coin you intend to sell.
  • Select your preferred payment method.

How Does Coinbase Work With Different Cryptocurrencies?

Beware that Coinbase does not support all cryptocurrencies but only the popular ones. Coinbase allows more than 120 coins (so you are not at a loss here). Here are a few mention worthy coins accepted on Coinbase:

 

  • Bitcoin Cash
  • Tether
  • Litecoin
  • Chainlink
  • Dogecoin
  • Solana
  • Cardano
  • Ethereum
  • Bitcoin

On an Endnote, What are The Trading Costs on Coinbase?

Fees charged by Coinbase to transact on their platform depend on

 

  • The funding source
  • The size of the transaction
  • The type of account you had set up
  • The type of payment method you chose
  • Your region and country
  • The product

 

Transaction amount (in dollars) Transactional Fee (in dollars)
10 or less 0.99
Between 10 to 25 1.49
Between 25 to 50 1.99
Between 50 to 200 2.99

 

But what about Bitcoins, right? Bitcoins cost way more than these numbers but Coinbase allows you to buy them in fractions. The cost of the spread markup of 0.5% will be added to your total trade value.

 

Coinbase also charges you for transacting above 200 dollars depending on your payment method:

 

Payment method Fee
US Bank Account 1.49%
Coinbase USD Wallet 1.49%
Debit Card 3.99%
Instant Card Withdrawal Up to 1.5%

FAQs

  • Can you make money off Coinbase?

You can earn money on Coinbase by buying dollar-pegged stablecoins like USDC and Dal and holding on to them. You earn the following rewards for holding each of these coins in your Coinbase account:

 

  • 2% APY rewards for holding Dal
  • 0.15% for holding USDC

 

  • Is Coinbase good for beginners?

Coinbase is the easiest platform for beginners in the crypto trading world. Create an account for $2 and start trading through their “earn while you learn “ program. So, yes beginners should try their crypto luck on Coinbase.

 

  • Is there a monthly fee for Coinbase?

No, you can get a free Coinbase Pro account for free. Coinbase also charges nothing for holding your funds in your account. Since it’s free you can hold your crypto assets as long as you want.

 

  • How does Coinbase work step by step?

You can use Coinbase on a desktop or on your smartphone. Here’s a step-by-step guide on how to navigate through your Coinbase app to start trading:

 

  • Tap on the ‘+ Buy’ icon on the app’s Home tab.
  • You will have a set of assets displayed; select one.
  • Enter the amount that you want to buy. It should be denominated in your local currency or crypto.
  • Click on Preview Buy and review your purchase. If you are unsure at this stage, tap on the back button to make a change.
  • If you have no confusion whatsoever, click on ‘Buy Now’ and complete your transaction.
  • Want a recurring purchase? Click on One Time Purchase to choose how often you would like to repeat the purchase.

 

  • How much does Coinbase charge to withdraw?

Coinbase levies a 1% fee in addition to the standard network fees when you convert your crypto into cash and withdraw it. The standard fee is to initiate your transaction through the decentralized cryptocurrency network. This fee is the same for all cryptocurrency transactions (whether selling, buying, or withdrawing) on the Coinbase platform.

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