With the recent Bitcoin excitement in the marketplace, I thought it was finally a good time to sink some cash into the cryptocurrency and see what fortunes, if any, were to be had. Full disclosure: I’m not a trader so what follows is a layman’s account of an investment experience.
After reading a book about Bitcoin, watching countless videos and listening to word on the street, I chose Coinbase to be my Bitcoin broker as it seemed like a safe bet. They are by far the most established BTC trading platform, the website looks decent, they have a lot of funding, and it’s a largish company that would appear to be sticking around for the short to medium term at least. From my research I couldn’t even see a second choice, so I just went ahead and went through the fairly extensive ID verifications required to get my account setup on their platform.
The Problems Begin
When I started out with Coinbase, in Christmas of 2015, I took it really easy and just bought £20 worth of BTC and another £20 worth of Ethereum, just to make sure the transactions were possible and the whole process worked. Nothing unexpected happened at this stage.
The Coinbase Mobile App
I wanted a way to track the value of my mini investment so it seemed like a good idea to get the Coinbase app. I was immediately surprised that the app wouldn’t launch, it had a problem getting or parsing the pricing data and crashed instantly. No biggie I thought, I don’t really have anything to track. A month or two later, a new version of the app came out, same problem, crash on start. Strange, I thought. Another month or two later another new version, same instant launch crash. I should have seen the signs. I sent Coinbase an email asking if there were any pirates onboard the ghost ship – well not in those exact words – anyway, no answer.
After what seemed like a long time, I think it was around 6 months, I noticed that their app was finally working. It was a relief, but I wasn’t sitting on the edge of my chair or anything. As an app developer let me point out that each time I tried I reinstalled the Coinbase app from scratch, knowing that the package files can be left in an botched state – this didn’t help.
BTC Surges 100% in 2016, Time to Buy?
Watching the steady growth over 2016, I was impressed – like many others – that BTC value actually doubled in less than a year, and it seemed to be storming ahead confidently. Let’s sink some cash in, I thought, and started out with £500. I bought at £726 a Bitcoin. The currency forged ahead strongly until £900 – I thought this may keep going, let’s put another £500 in. All was well, for 24 hours at least, then, as luck would have it, the biggest crash of 2016 happened, hundreds of pounds of my investment disappeared in less than 24 hours.
As you may know the BTC price varies quite a bit depending which exchange youre looking at, so its hard to compare the buy/sell prices to see how much of a cut Coinbase is taking on a buy. However, what is very obvious is the hefty commission they charge per transaction. Not listed anywhere on the site but once you make a transaction, the £20 fee is obvious enough. When I sold the fee was lower, £7.45, not sure how they calculate that.
The easiest way to buy BTC is with a debit card, and from the above experience you can see its also the most expensive. But the website shows you another option, you can also choose to do a bank transfer which ought be cheaper. The bottom line is less obvious and of course less favourable than customers are lead to believe.
At first I tried to do the transfer which I assumed was to a UK account and therefore free of charges, but further down the line I discovered the transfer must be done to a European account. A £10 fee. Well its a one off, I thought, lets take the hit now and I should be able to recover it later on. The website presents you with a message when you initiate the transfer, “Your bank account will be verified 1-2 business days after the transfer is completed.” Two days go by, no verification. 5 days, none. Ive sent in total another 4 messages to Coinbase asking to explain the meaning of this misleading message, of course no answer. I should point out that to date Ive sent at least 10 messages to Coinbase support and have never once received an answer. So there is no Coinbase support, it’s a mirage. At the time of writing it’s a week after the verification date and nothing has happened yet and probably never will. Maybe the company is folding after all. I have been given no reason to trust Coinbase support whatsoever.
Trying to Sell on Coinbase
So BTC is tanking, no problem I thought, I can always sell, right? Would you believe the Coinbase website went down for about 24 hours during the BTC price fall. Of course it did. I was kicking myself, but while Coinbase gave the impression of professionalism, this was one scenario I didn’t anticipate. By the time the site came back up I was down £200. I sold £500 at a considerable loss, and figured I’d keep the rest in, just to see what happens.
Trying To Get Your Money Out Of Coinbase
I should mention at this point that you will not find any info anywhere on the Coinbase website about how to get your money out of Coinbase and back into your back account. I did spot this right away, and sent an email enquiry. Of course it was never answered. I thought I’d persist. To date I think I’ve sent the same enquiry at least 3 times. No answer. So I’m left feeling a little disenchanted with the folks at Coinbase, this is not a serious company in my opinion.
Today I tried to get my £500 out of Coinbase and back into my bank account. This is the surprise message I was presented:
How Many Ways to Lose Money with Coinbase
Well it looks like I don’t have much choice. So I proceeded with the bank transfer only to be presented with the following message:
Of course, that’s my bank account that’s never been verified! 🙄 So now it looks that I’ll have to wait indefinitely before I see any of my money back. I will be pursuing this for sure.
Tracking Final Losses
£492.55 (sold £500)
to be updated …
Coinbase cannot be trusted, in my opinion. I feel woefully mislead as a customer. I would strongly advise against using their service. I’ve personally put £1000 into Coinbase and it currently looks like I will never see my money again.