What are some of the positives and negatives of Coinbase?

[BitTrade]

Just wondering what some of your opinions were on coinbase, particularly their business model of acting as sort of a full-reserve bitcoin bank that issues claims to bitcoin rather than actual bitcoins.

Do you frown upon this type of centralized service, or do you see it as an essential service to add extra convenience beyond what is capable with the standard bitcoin protocol?

[tclo]

Just wondering what some of your opinions were on coinbase, particularly their business model of acting as sort of a full-reserve bitcoin bank that issues claims to bitcoin rather than actual bitcoins.

Do you frown upon this type of centralized service, or do you see it as an essential service to add extra convenience beyond what is capable with the standard bitcoin protocol?

I didn't like them at first but now have found how to incorporate them into my BTC buying and selling and now I use them more than any other exchange.   Bid/ask spread is usually pretty small.  They do charge a relatively high commission but it's worth it if you are getting a good price, esp when selling.   

Bitstamp has tight spread too, but if you are in the USA, not that easy to get your funds out of there unless you want to do wire transfer or send the BTC to somewhere else to sell it.  Anyway for now I like Coinbase.

[chadqberry]

Love coinbase!  Easy to buy, easy to sell, easy to get money in/out. 
I need fiat out of my BTC funds occasionally and they make that very painless.

[zoinky]

I've always been a fan of Coinbase, and now with the instant buying, it just makes me a happier customer.  I still use other exchanges for trading, but when I need to get actual fiat in or out, I use Coinbase.

[joesmoe2012]

Their limits are too small to make them worthwhile to any large investor.

I was told by their staff @ multiple conferences that my limits would be further increased, but they still have not been.

The company is as legit as they come, but i can't consider them to be a serious trading platform with 1% comission and such low limits.

[CurbsideProphet]

Never had any issues with them although some have reported having their transaction canceled.  Only issue was it would take like 4-5 business days for the Bitcoin to clear but it looks like they have an instant option now (haven't tried it) which might make that issue moot.

[halfawake]

I'm pretty happy with Coinbase.  I'm almost a month from my first purchase with them and it looks like they're about to (in another 19 hours) bump up my buy limit to 50 bitcoins.  I'm not a hardcore bitcoin investor so this limit is probably more than I'll ever be buying at one time since that's almost $5,000 at today's exchange rate.  

Positive aspects:
Very easy to buy bitcoins (for those of us who are in the US.)
Looks fairly easy to integrate Coinbase tools into a website if you're setting up a bitcoin based e-commerce site.

Negative aspect:
The spread between the price on Coinbase and an actual exchange such as CampBX or Bitstamp is often several dollars.  Right now, the difference between the price on Coinbase and Bitstamp is $1.30.  This may not seem like much, but it quickly adds up if you're buying several bitcoins.  For example, if I were to buy 5 bitcoins right now, it'd cost me $471.10 on Bitstamp.  This same purchase would cost $480 on Coinbase, costing you an extra $9.  

So if you factor in the spread between Coinbase and the exchanges, the buying fees are more like 1.875% than the 1% that they quote.  The $9 isn't much if you're doing only one buy order, but it adds up over time if you're going to buy a lot of bitcoins.

(I used Bitstamp's price just because it's one of the easiest places to look up prices since you don't have to login or anything.  With them, there would obviously be extra fees like the wire transfer fees, but the CampBX price is $94, which is not much different than Bitstamp.)


Having said all this, if you're planning on investing your bitcoins in a place like Coinlenders with a high rate of return, you can earn back much more than the $9 in a month, so this "fee" may not matter to you.