010 - The Coinbase Conspiracy
It's a well know fact, that Coinbase is one of the major cryptocurrency exchanges in the World. It is one of the oldest and largest exchange supporting more than 32 countries with approximately 4 million users around the world. Founded in 2012, Coinbase allows it's customers to buy and sell Bitcoins via many fiat and online methods. On Coinbase, one can buy Bitcoins through Bank transfers, credit cards or even through Paypal transfers. In May 2016, Coinbase also started GDAX, a Bitcoin exchange where users have the ability to trade a variety of digital currencies.
So, Coinbase holds a substantial degree of total Market share and customer base within itself.
Coinbase Went Offline For Hours Without Notifying It's Users
A few months back this 'Largest' exchange suffered the greatest controversy of all time. In June 2017 Bitcoin climbed to it's record high of $3041. But pretty soon, it declined back to almost $2,532 , dragging along with it Ethereum and other stocks.
During it's decline, the largest cryptocurrency exchange Coinbase went offline all of a sudden giving no opportunity to its users and investors to manage their money in that downfall. During that period, major investors suffered huge losses and blamed the exchange for it wholeheartedly. To those obligations and controversy, Coinbase replied that the exchange went offline because of High customer trading requests and hence it needed to go under maintenance. It came back online after all the damage had been done and Bitcoin retreated to $2750.
You know what the Irony was! while CoinBase was offline, a new blockchain based project was having their crowdsale and absorbing most of Ethereum and Bitcoin and also receiving a massive amount in their crowd sale which was $150 Million. That blockchain project was BANCOR (BNT). During the time Coinbase went offline, Bancor set record of highest amount of ethereum and bitcoin received for their Initial Coin Offering (ICO). Because of CoinBase offline issue, most people didn't get the chance to acquire some BNT's for themselves which now has four times the price compared to when it was introduced on the exchange.
Holding a subtaintial position in the market, it was not apt for Coinbase to give such petty explanations for going offline when it's customers needed it the most. This was a highly irresponsible behaviour and was criticised by many at varying point of time. It wasn't the first time Coinbase went offline, Coinbase has a history of going offline during the major Bitcoin events. No one knows why it happens. Whether it's a genuine technical fault or a conspiracy. But it was what it was.
Some Other CoinBase Controversial Points
Apart from this , Coinbase is also suffering from many controversies which everyone should be aware of if you're going to become a part of their customer base and plan to start using their service.
Coinbase Track User's Spending Pattern
Coinbase holds the right to track it's user's Bitcoin spending pattern and also can freeze your account if you try to spend your Bitcoins in some illegal stuff like Gambling or Dark net use.
Irrational Affiliate Reward Progam
Although Coinbase offers one of the most lucrative rewards in their affiliate program, sometimes users don't recieve what they have been promised. It's a major cause of concern because the affiliate program helps contribute in a major way to Coinbase users.
I'd like to conclude saying, holding a major position in Cryptocurrency Market also comes with great responsibility. Going offline for hours without notifying your customers is highly irresponsible and holding all rights to track the spending pattern is something we need to give a thought about.
So, have caution while dealing with CoinBase and decide it's efficacy by yourself.
Author @cryptonet
Exchanges are for buying > get your coins off exchange as soon as possible
Nice post @bitconspiracies. Followed you :) FYI, it is sometimes more profitable and wiser to get the ICO tokens off the exchanges once they are traded. The price often plummets in the first few days after being listed. Of course, ALWAYS do your own research and take everyone's "advice" with many buckets of salt. This new sub-sector of finance is still the Wild West.
Be it coinbase, poloniex or bitfinex we are hearing bad news all the time with these exchanges is there any we can 100% trust? , cheers mike
Which is the most trusted exchange ? I will move to that
LocalBitcoins.com you can literally buy/sell BTC in person (or online). It's all peer to peer transactions and it has a very good reputation along with the sellers on the site. You can pretty much use whatever payment method you want. That being said, I've never used it but I feel like it's the most transparent exchange out there.
Thank you for the information
though it is pretty expensive when compared to BTC exchange sites, unfortunately :(
I did that for awhile. Like it was mentioned you pay a premium for those coins.
Every seller I dealt with wanted money orders/BOA/Chase cashiers checks or other globally liquid assets. Not to mention they were rarely in the country they advertised and buying from the same person 4 times in a row gave me four different people to send cash to in three different countries. Ukraine x2, Romania and Georgia (Russian Georgia). But it was fast and easy and mostly anonymous.
Word of advice: If you do anything 'unusual' with your BTC/LTC/ETH get TOR and Tails. Disable java. Use different electrum accounts for transfers between the two operating systems. Rinse and repeat.
And this is why its always best to keep your crytocurrency in your own wallet, and off the exchanges, then you can do whatever you want with it, and you know its safe.
Wow! Coinbase is up to some questionable things!
Or someone is hacking coinbase in an effort to profit themselves.
Very interesting ! Thanks for sharing !
Despite negative reviews and feedback I wonder why people still use it?
cause its the most user friendly
Not user friendly to me. They have all my bank information and I have to use Twitter for support?!? Yet I have no bitcoins either. Have to close my account. I wouldn't trust them.
The great thing about the decentralized format is that it is open, uncontrolled and limitless.
And these factors are also drawbacks to it.
Good Article!
Do you have experiences with other exchanges?
I've got some trouble with Poloniex to get verifyed ... It tooks two month ...
Very good please follow up please
Cryptocurrency exchanges, this is the flaw in cryptocurrency. Follow the money, who owns and controls them. Perhaps think of more than one being owned by the same entity.
Coinbase can cancel your account over just about anything that they find questionable . Even legal things like nootropics that are 100% legal can get you coinbase account banned.
Interesting! Well the CEO of Coinbase was on Bloomberg saying he was in talks with Hedge funds about how best to be the most regulated in the business. The Bloomberg presenter was pointing out that one of their customers lost something like $8,000 from a hack.
Their you can see that the blockchain technology can be the best in the world, but people can manipulate it all time in political things. Very, very shamefull that this happenend more than one time..
I don't trust coinbase
Out of curiosity who are you using instead?
https://www.bitquick.co
great post; upvoted, resteemed and followed!
Interesting argument. Although, anyone using CoinBase as an actual wallet deserves to lose out when Bitcoin starts hitting the floor.
Thanks for sharing, nice article :)
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nice post about coinbase.I thinks it is a good exchange to me.
They keep getting rid of my bank so I am forced to pay in with my debit card at a higher percentage. Criminals.
Great post! Very informative. Followed and upvoted! =)
Never really trusted coinbase. Thanks for the info.
A few coincidences do not maketh a conspiracy which is another way of saying correlation is not causation. You said as much yourself: "No one knows why it happens. Whether it's a genuine technical fault or a conspiracy. But it was what it was." Question: when is something ever not what it was?
I'm rather given to think your title was actually click bait, at the very least it should have had a big "?" at the end of it.
Maybe instead of a conspiracy, they are just a rapidly growing company having to deal with tens of thousands of new customers per day and massive ICOs generating huge volumes of transactions which are often backlogged on the respective blockchains anyway? It's not like they aren't making money out of every single transaction that passes through them - what is their incentive to throttle that and try and impact the market in unpredictable ways?
Sorry I'm just not seeing it.
Your final advice: "have caution while dealing with CoinBase and decide it's efficacy by yourself." should be applied to all companies. Remember the beauty of the current blockchain ecosystem is no one forces you to hold you funds with CoinBase or any exchange. You can just hold them all locally in a wallet and contribute to ICOs at will, and make trades on distributed exchanges and places like BitShares.
Ultimately anyone who didn't get to sell last time BitCoin crashed is probably happy they are in at BTC/USD $4000+ now. You'll also notice that when the ETH flash-crash happened CoinBase made good on the issue caused by their GDAX exchange an its lack of liquidity - which ultimately wasn't their problem at all. The blew several million dollars making customer happen anyway. And the lucky trader who bought ETH for pennies of the dollar during the crash - kept his money just the same.
Very nice
i use Exodus and are happy with it. =) i use Coinbase just to buy bcoin and then i transfere it directly to my wallet :P and trade coins on exodus
Meh. Coinbase is a great place to start when you first start out with bitcoin. However a bit of research should reveal better alternatives.