Coinbase vs GDAX – What’s the Difference?
With more and more people looking to begin buying and trading cryptocurrencies there is a lot of misinformation out there as to which exchange is the best or even what certain exchanges can do. In our Coinbase vs GDAX comparison we’re going to break down the similarities and the differences between both of these popular exchanges and try to clarify which one is best for you to use.
What is Coinbase?
Coinbase was founded in San Francisco in 2012 with the aim to create a platform that can be used by anyone to easily buy and sell some of the larger cryptocurrencies, such as Bitcoin, using normal (fiat – USD, EUR etc) currencies. By 2013 it had become the highest funded Bitcoin startup ever.
It now supports an impressive 10M+ users from 32 countries around the world and a staggering $50B+ in digital currency has been exchanged since its launch.
For a more indepth look at Coinbase, we recommend reading our Coinbase review.
You can also sign up to Coinbase here and receive $10 worth of FREE Bitcoin, in addition to helping Cryptos Decoded.
What is GDAX?
GDAX is actually owned and founded by the same people that founded Coinbase. Both companies are owned by the same people and they are both connected. Technically they are separate services and both offer very different features but as they are connected you can get some of the benefits of either services very easily.
Following the success of the Coinbase platform, the owners decided that they would create a new exchange aimed at more advanced users that allowed for more currencies and altcoins to be traded. In 2015 “Coinbase Exchange“ was launched which was eventually rebranded to GDAX in 2016.
GDAX focuses on more hardcore traders and experienced users. They offer a fully-fledged cryptocurrency exchange that allows users to trade a range of currencies in a very similar way to traditional stock or forex platforms. This includes a variety of features such as market orders, stop orders and limit orders.
Buying and Selling Differences
Using Coinbase to buy Bitcoin is one of the simplest and easiest ways to buy Bitcoin currently available. Coinbase is incredibly user friendly and is perfect for beginners because of the simplicity and clean aesthetics of the site. The fees are clearly labeled and the whole process take takes just a few moments.
Coinbase allows users to purchase cryptocurrency with credit or debit cards and direct bank transfers. There is also the option to sell cryptos and be paid into a Paypal account. Coinbase directly facilitates your order themselves, there is no exchanging currencies with other users, it’s all done directly through Coinbase as if you’re buying any other product you can think of.
In addition to this, Coinbase offers a very simple and user friendly mobile app that has almost exactly the same functionality as the full webpage. This increases the accessibility of the platform and makes buying Ethereum, Bitcoin, Litecoin and Bitcoin Cash incredibly easy.
It’s equally as easy to sell on Coinbase as well. Using the website or the mobile app, all the user has to do it put in how much they want to sell, set how they want to be paid and press sell.
GDAX, on the other hand, uses a system more traditionally found in stock and forex markets. The user will need to place and order on the exchange. GDAX will then match buyers and sellers from the users on currently on the website.
GDAX only accepts direct bank transfer for buying and selling. There is no feature to accept credit or debit cards and they don’t offer a Paypal selling method. However, it is possible to transfer any funds to or from a Coinbase account to buy or sell using different methods.
There are 4 types of orders that can be used:
Market Orders – These are the simplest type of orders. This will require the user to enter the amount they want to buy or sell. GDAX will then fill the order with the best available price offered by other users on the site and the trade will take place.
Stops Orders – This will allow users to place a buy or sell order that will only work when the cryptocurrency has reached a specific price. All that is required is an amount you want to buy and sell and a stop price.
Limit Orders – This requires the user to choose both the amount to buy or sell and the price to buy or sell at. When another user matches the first users buy or sell price a trade can take place.
GDAX also doesn’t currently offer a mobile app so you’re limited to trading on your their website. This probably isn’t much of a concern as most of the target market of GDAX is not likely to be using apps for trading anyway.
The Coinbase Conversion Fees vary from 1.49% to 3.99%. This depends on multiple factors such as: location, payment method and other circumstances. In general standard bank transfer fees have a cheaper Conversion Fee than Credit Card transaction fees, this is because Credit Card companies charge extra fees. For more information check out the fees section on the Coinbase website.
GDAX fees are generally lower with the standard fee being no more than 0.3%. This depends on the 30 day volume that has been traded and can go down to as little as 0.1%. There are also deposit and withdrawal fees which are set to the following:
- ACH Deposit: Free
- ACH Withdrawal: Free
- SEPA Deposit: €15
- SEPA Withdrawal: €15
- USD Wire Deposit: $10
Whilst we generally do not advise anyone to store their cryptocurrency on an exchange, we will take a look at how you’re able to store anything you’ve bought on both Coinbase and GDAX.
With Coinbase the best way to store your crypto is with the Coinbase Vault. It allows a time delayed withdrawal feature and even has a multiple approvers feature to help ensure that your money is safe and only you can take it out.
GDAX does not offer a vault and instead has a general online wallet.
We’d generally recommend using a hardware wallet like the Ledger Nano S to store any cryptocurrency you own.
Read our Ledger Nano S Review for more information and what we think of it.
Check out the latest price of the Ledger Nano S on Amazon.
For more information on wallets, check out our guide to the Best Ethereum Wallets.
Coinbase or GDAX – Which is right for you?
Both Coinbase and GDAX are well respected and trustworthy ways to buy and sell cryptocurrencies.
Coinbase is right for you if you’re looking for the easiest and quickest way to start buying, selling and storing cryptocurrency. It’s incredibly user friendly and if you’re looking to use credit or debit cards, the only option out of the two.
GDAX is definitely made for a more experienced user. If you’re able to understand how to buy and sell on such a platform then you can definitely take advantage of the very low fee rate and potentially save yourself a lot of money.
Either way we’d recommend signing up to Coinbase using our referral link to grab yourself some free Bitcoin. Then both options are open as to how you wish to buy more.