Coinbase is one of, if not the largest online cryptocurrency exchanges. Supporting purchases of Bitcoin, Ethereum & Litecoin using credit or debit cards. It works in the same way as any online purchase, has a great user interface with interactive charts, and supports 2factor authenticator for enhanced security when logging in.
The problem with Coinbase however, is the fees you must pay when making a purchase. But there is actually a total legitimate way to avoid the fees altogether.
What are the Coinbase Fees?
If you want to purchase any of their 3 supported cryptocurrencies with a credit or debit card for example, Coinbase charge a whopping 3.99%. (Full Fees List)
The good news however is that you can avoid paying this fee altogether! What Coinbase don’t want you to know, is that their sister company, Gdax, who’re owned & operated by the same parent company that own Coinbase allow users to purchase cryptocurrency with 0 fees.
Although the platform is slightly less user friendly and looks a lot more like a trading platform than a simple buy, sell send wallet, it is still easy to use and could save you thousands!
On a £1000 purchase, you would end up paying £39.9 in fees alone!
So how do you avoid paying Coinbase fees?
Because Gdax and Coinbase are owned by the same company, they use the same back end processes to handle transactions and store your crypto. This means that sending between the two is instant and free which.
Coinbase only charge fees on crypto purchases, meaning you can deposit fiat currency for free.
Step 1. Deposit your Coinbase account with whatever fiat currency you use.
Step 2. Send the fiat from Coinbase to Gdax
Step 3. Buy your desired crypto on Gdax using a limit purchase. They charge an albeit much smaller fee for a simple market purchase, but a limit buy is also very easy to do and most importantly, completely free!
Step 4. Send your crypto back over to Coinbase if desired, again completely free!
And there you have it, a simple way to avoid paying potentially thousands in Coinbase fees.
If you live in the UK, the best thing to do is get an online banking app which allows you to buy USD, such as Revolut. You can then deposit USD direct to Coinbase rather than waiting for a SEPA payment from your UK bank account. Then just send the USD to Gdax and buy your BTC fee free.
Sign up to Gdax here
This video does a great job of explaing the whole process in more detail: (Credit: https://www.youtube.com/watch?v=lcCIjIAqM-4)