On April 29, Coinbase dropped the ball. Faced with a deluge of buy orders, the ramp’s servers and IT systems couldn’t keep up. The result? A crash, preventing thousands of orders perhaps worth millions from FOMOing into the Bitcoin and crypto market.
History shows that at the beginning of few Bitcoin rallies or crashes, the exchange simply shuts down, becoming inaccessible to thousands of traders and investors who are ready to capitalize on market gains. This trend is now obvious and many crypto enthusiasts are picking up on Coinbase for the same.
While Coinbase was down, Bitcoin price not only roared past $8,000 but it temporarily rose to $9,400 in the Asian session much to disappointment of traders, who while wishing to capitalize on the rally couldn’t because of system failure.
So @coinbase really dropped the ball today. Years after the 2017 Bull Run they crash when the market started pumping. They need to invest in better servers and IT people. The good thing now is there are tons of other options now like Binance US and more. #crypto #bitcoin #btc
— Thinking Crypto (@ThinkingCrypto1) April 29, 2020
At press time, BTC is hovering below the $9,000 mark, up 23 percent in the last trading week.
And this is not the first time!
Last year, when BTC soared to around $14,000 six months into a damaging crypto bear market that saw Bitcoin prices tank to lows of $3,200, Coinbase servers failed for the second time. It drew complaints from the trading community who anchored their hopes on one of the top US cryptocurrency exchanges.
A year prior, in 2017 during the great crypto rally, the same was an experience but at least traders cut them some slack because of the flurry of new orders. On top of this, their customer care was literally unreachable.
Coinbase is well regulated, compliant with New York‘s laws, and has a trusted custodial service, and it has never been hacked. Besides, since most of US banks support the exchange, it means traders can connect their bank accounts and deposit or withdraw funds at will. The ramp’s support of fiat and being compliant means it is a favorite among traders despite its failures.
However, this “ease and luxury” comes with a cost. Although Coinbase Pro (its trading arm) is cheaper, Coinbase charges high fees compared to others. In some cases, it can be 10X more than say Kraken for instance.
This week I looked at the fees that exchanges charge. The chart shows exchanges sorted by least (1) to the most expensive (20). it becomes quite clear that Binance US and FTX are the least expensive exchanges overall. The most expensive are Gemini, Bitstamp, and Coinbase. pic.twitter.com/KNDL0dIZU0
— Larry Cermak (@lawmaster) April 23, 2020
Add this to their failure to improve their systems being a world leader with venture capital support, their lapses is gradually paving the way for Binance US.
BinanceUs May Emerge As Tough Competition To Coinbase
Binance US is a branch of Binance Global that complies with SEC rules and for US citizens only. This follows a new order that prevented them from accessing Binance Global in 2019. Currently, it is available in most states except New York which is more stringent.
The hype around Binance US stems from its reliability, new products, and low fees relative to US-based exchanges.
There’s never been an easier way to buy crypto than Instant Buy and now you get .25% cashback on every purchase!
What token do you want to be added to the Instant Buy portal? Tell us your favorite!
— Binance.US 🇺🇸 (@BinanceAmerica) April 29, 2020