We take our role in providing guidance and education regarding the card payment industry very seriously. At our own expense, we have vigorously defended our right to continue expose unethical and predatory practices in the industry, successfully defeating every attempt to silence us. However, fending off frivolous lawsuits is costly. To sustain these efforts, one of the ways we generate revenue is through affiliate partnerships with ethical providers. This means that some of our outgoing links connect business owners to trustworthy, low-cost payment processors, which is what most of our readers seek. We see this revenue channel as a win-win-win for everyone involved. Business owners find good processors, processors get good clients, and we are able to continue to provide a valuable service to the small business community. We also recommend and link to many services that do not compensate us. Our priority is to guide you to the best solutions for your needs, regardless of potential revenue. If you have questions, please feel free to contact us.
All mentions of rate and fee costs are estimations based on publicly available information and client feedback. Actual costs may vary based on a variety of factors unique to your business.
Note: The 2023 SEC lawsuit against Coinbase has led us to recommend caution to businesses considering Coinbase for any major payment services until the lawsuit is settled.
Overview
In this Coinbase review, we’ll provide a clear look at their virtual currency services, including cryptocurrency trading, digital wallets, and merchant payment solutions. We’ll outline which users and businesses may benefit most, while also highlighting customer reviews to reveal common feedback and concerns. Along with services, we’ll cover fees, security measures, and key features so you know what to expect. By the end, you’ll have the insights you need to decide whether Coinbase is the right choice for your cryptocurrency needs.
About Coinbase
Coinbase Homepage
Founded in 2012, Coinbase (coinbase.com) is a virtual currency processor that helps users make transactions with digital currencies like bitcoin, litecoin, and ethereum. Coinbase’s platform is available to developers, consumers, and business owners, but this review will primarily focus on how Coinbase helps businesses accept cryptocurrency payments from customers.
2023 SEC Lawsuit
A major and likely industry-defining lawsuit was brought by the SEC against Coinbase in 2023. According to the US government:
“The Securities and Exchange Commission […] charged Coinbase, Inc. with operating its crypto asset trading platform as an unregistered national securities exchange, broker, and clearing agency. The SEC also charged Coinbase for failing to register the offer and sale of its crypto asset staking-as-a-service program.”
This suit is currently ongoing and its results will determine the history of not just Coinbase but likely the entire cryptocurrency segment of the world economy.
No More Fiat Payouts
Like its competitor Bitpay, Coinbase previously enabled businesses to accept an online bitcoin payment from a customer and then receive that payment as a deposit to the business’s bank account in fiat currency. However, it appears to no longer offer this feature, which means that merchants must accept payments in their chosen cryptocurrency and then exchange that currency themselves. This leaves businesses vulnerable to fluctuations in market pricing for their given cryptocurrency.
Favored by High-Risk Merchant Types
Bitcoin (like other virtual currencies) is an appealing payment method for many high-risk merchants because of its reputation as “digital cash,” meaning that it is not regulated by bank policies and that all sales are final. However, Coinbase monitors accounts for illegal and high-risk activity, and the company will deactivate accounts that violate its terms of service. For this reason, Coinbase should not be relied upon as a payment processor for fringe products such as e-cigarettes, CBD oil, medical marijuana, gambling, firearms, adult products, or nutraceuticals.
Coinbase Products and Services
Cryptocurrency Trading
Coinbase primarily facilitates cryptocurrency trading, supporting a wide array of digital currencies. The platform offers a user-friendly interface for buying, selling, and trading these assets.
Wallet Service
Coinbase provides a digital wallet service, enabling secure storage for cryptocurrency assets. This service offers enhanced security and easy access to digital currencies.
Cryptocurrency Payment Processing
For businesses, Coinbase offers a cryptocurrency payment processing service. This allows businesses to accept cryptocurrency payments from customers.
Merchant Solutions
To aid businesses further, Coinbase provides merchant solutions. These services include tools and integrations for accepting cryptocurrencies, converting them into local currency if needed, and managing these transactions efficiently.
Cryptocurrency Conversion Service
Coinbase offers a cryptocurrency conversion service, allowing users to exchange one type of cryptocurrency for another.
Security Measures
Coinbase prioritizes security by using a mix of online servers and offline “cold” storage to protect user assets. Additional security features include two-factor authentication and insurance coverage.
Customer Reviews & Sentiment
Low-to-Moderate Complaint Volume for Coinbase
A review of external sources reveals over 30 negative Coinbase reviews on various review sites and forums. These may represent a fraction of the overall feedback about the company’s services. Key issues raised by users include account closures, software glitches, unfavorable exchange rates, and insufficient customer support. Some of these critiques label Coinbase as a ripoff or a scam. We invite you to share your personal experiences with Coinbase in the comments below, contributing to a more comprehensive understanding of their services.
Coinbase’s Approach and Philosophical Stance
A notable perspective regarding Coinbase is its engagement with mainstream financial institutions and acceptance of significant venture capital. This approach diverges from the decentralized, stateless ethos originally associated with cryptocurrencies like Bitcoin. As a result, Coinbase may not fully align with the preferences of those seeking complete anonymity and autonomy in their cryptocurrency transactions, particularly high-risk businesses. Businesses in high-risk sectors are cautioned about the potential for increased scrutiny and possible account termination when using Coinbase’s services.
Coinbase Lawsuits
Coinbase is involved in a class-action lawsuit, which alleges price manipulation on its exchange, contrary to its terms of service. The current status of this lawsuit is unknown, but it is unrelated to Coinbase’s payment processing services and is not expected to significantly influence its overall review rating.
In 2023, the SEC initiated legal action against Coinbase, a significant development in cryptocurrency regulation. More details on this can be found above.
Coinbase Customer Support Evaluation
Coinbase offers phone and email support, but the volume of complaints regarding account terminations and the lack of real-time support has impacted its rating in this category. Coinbase seems most suitable for individuals new to cryptocurrency, offering a platform for basic trading and exploration of digital currencies. However, it may not be the ideal choice for high-risk or high-volume merchants requiring a robust payment platform for Bitcoin and similar cryptocurrencies.
This content, enriched with SEO-optimized key phrases such as “reviews,” “complaints,” “customer reviews,” “customer complaints,” and “Coinbase review,” is intended to provide a balanced assessment of Coinbase’s services. Your input through comments and reviews is highly appreciated and will enhance the depth and accuracy of this review.
Industry Scores & User Ratings
Online Ratings Summary
PaymentPop
5
BBB Rating
1.07
Trustpilot
3.8
Average Rating
2.43
PaymentPop Rating for Coinbase
Negative Feedback
There are no negative reviews published about Coinbase on the PaymentPop website.
Positive Feedback
Coinbase has been my go-to platform for crypto investing. The interface is clean, easy to navigate, and I feel confident knowing my assets are stored securely. Whether I’m buying Bitcoin or exploring new tokens, everything just works smoothly. It’s the only platform I recommend to friends who are just getting started.
Coinbase BBB Rating
Coinbase currently has an “F” rating with the Better Business Bureau and is not BBB-accredited. The company has received 3,553 complaints in the past three years. Coinbase has resolved 1,593 of these complaints to the satisfaction of the user, while 1,960 complaints either were resolved to the dissatisfaction of the user or did not receive a final response from the user. This low response rate is a major factor lowering the company’s BBB rating. Coinbase has a 1.07 out of 5 star rating based on 379 user reviews on the Better Business Bureau website.
What Users Say
Coinbase has received 9 positive informal reviews and 484 negative informal reviews to its BBB profile. This profile receives feedback from merchants and non-merchants alike. The most recent review that is applicable to the merchant experience describes a frozen account:
I have been locked out of my account for more than 6 months due to moving countries and having my old phone stolen. Because of that, I have not been able to update the 2 factor authentication. They method to resolve is to verify my ID but it is not verifying any of my 3 forms of ID. I have semt them 4 different emails about the issue and only the first one got a response from and it was clearly a copy/paste. They did not look into my issue otherwise it could’ve been resolved. I just want to access it so I can get ahold of my investment in there and to of course update all my information. Their chat support is complete garbage. If you cannot sign in to your account it will always go back to suggesting ways to access it. Their phone support is literally just to lock your account. No way to speak to a real person.
The BBB is unable to locate an accurate address for Coinbase and does not appear to have received a response from the company since January 2018. We therefore agree with the BBB’s rating for the purposes of this review.
Trustpilot Rating for Coinbase
Coinbase has a 3.8 out of 5 star rating based on 15,229 user reviews on Trustpilot.
Positive Feedback
I’ve been using Coinbase for years without any issues. The app is user-friendly, making it simple to buy, sell, and store cryptocurrency securely. Transactions are smooth, and the platform provides a seamless experience for both beginners and experienced users. I appreciate the added security features and the peace of mind that comes with using a trusted exchange. Highly recommend!
Negative Feedback
I have not been able to access my account for nearly two weeks and have not been informed why or when I will be able to access my account. I phone customer care and they do not know how to help me or give me anyone who will be able to help me. I have had an account with Coinbase for ten years and to be shut out on my account without any warning or communication from anyone at Coinbase who can inform me is beyond a joke.
Processing Rates & Fees
Free Cryptocurrency Processing
Coinbase offers a convenient way for users to exchange between fiat currency and multiple cryptocurrencies via its bitcoin exchange, applying variable conversion rates. Specifically, for merchants, Coinbase provides a solution to accept cryptocurrencies only. Merchants can receive payments from customers in Bitcoin, Bitcoin Cash, Ethereum, or Litecoin directly into their secure online wallet without any fees for receiving these payments. However, all transactions and deposits are governed by Coinbase’s terms of service, without the necessity for monthly or annual contracts.
Virtual Currency Price Fluctuation
Accepting cryptocurrency payments allows businesses to avoid traditional processing fees, yet it exposes them to the volatility of cryptocurrency prices. This volatility affects Bitcoin and other cryptocurrencies alike, potentially impacting the transaction value negatively if the exchange rates decrease. Nonetheless, this could also appeal to merchants optimistic about the future value of these currencies.
Prohibited Business Types
It’s crucial for businesses, especially those in high-risk sectors, to fully understand and comply with Coinbase’s terms before registering for its services. Coinbase adheres strictly to regulatory frameworks, actively monitoring for any misuse of its platform. Violations of laws or Coinbase’s terms can lead to account termination and possible retention or seizure of cryptocurrencies in the user’s wallet. Coinbase specifically prohibits involvement in activities such as unlawful actions, including violation of laws, regulations, or sanctions programs, particularly those administered by the U.S. Department of Treasury’s Office of Foreign Assets Control (OFAC), or engaging in transactions involving proceeds from unlawful activities.
Certain industries and practices are explicitly listed as prohibited, including e-cigarettes, medical marijuana, weaponry, nutraceuticals, adult content, multi-level marketing, and other specified high-risk industries. Nonetheless, Coinbase mentions that money services, charities, skill-based games, and religious organizations may be eligible for the service with prior written approval after thorough disclosure.
An Easy Solution for Crypto Payments
Coinbase presents an affordable and straightforward avenue for businesses to accept cryptocurrency payments. However, its service agreement specifically defines the scope of businesses it can accommodate, focusing on compliance and regulatory adherence to ensure a secure and legal transaction environment for both merchants and customers.
Employee Reviews & Sales Practices
Transparent Price Quotes
Coinbase appears to primarily market its services through traditional advertising and corporate partnerships. There is no indication at this time that the company uses industry-standard independent sale agents or telemarketing to sell its services. Coinbase discloses its pricing and contract terms on its website, but some of this information is not prominently listed. Business owners are encouraged to thoroughly read through the company’s “Help” section if they have any questions about pricing or contract terms.
No Red Flags
Coinbase’s commitment to disclosure, as well as the absence of “teaser” quotes on its website, has earned it an “A” rating in this section. If you suspect that the company is charging you hidden fees, you may be able to find and eliminate those costs with a third-party statement audit.
Coinbase Competitors
Compare Coinbase to competitors that earned top marks.
Coinbase appears to be a straightforward and cost-effective platform for first-time cryptocurrency users looking to accept bitcoin and other digital currencies from customers. The platform is designed with simplicity in mind, making it accessible for those new to digital currencies. Coinbase does not impose burdensome fees or contract terms on its users, which is a significant advantage for small to medium-sized businesses looking to diversify their payment options without incurring additional costs.
However, it is important for merchants to be aware of Coinbase’s stringent fraud prevention policies, which are much stricter than those typically encountered in traditional payment processing. While these measures are in place to protect users and maintain the integrity of the platform, they can sometimes catch merchants off guard. Coinbase is highly recommended for standard-risk e-commerce businesses that want to offer an emerging, alternative payment method. However, it is not currently advised for businesses operating in regulatory gray areas, as the stringent compliance requirements and potential for account freezes could pose significant challenges. Businesses should thoroughly evaluate their specific needs and compare Coinbase’s offerings with those of other top-rated cryptocurrency payment processors.
