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Understanding Coinbase

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Re: Understanding Coinbase

#121

Post by smeej »

opportune wrote: post #39

The point of coinbase is to be a normie-friendly, trusted onramp into crypto. It has tons of direct and indirect competitors, many of which will give you better rates or more variety, but none of which have managed to market themselves into the degree of "legitimacy" that people give Coinbase. It is an exceedingly boring business IMO.

Kraken's dominance in Europe is the closest analogue, I think, and it's also an American company complying with American laws.

If they ever sort out ACH and card payments for the U.S., I don't see what keeps them from taking a huge bite out of Coinbase's U.S. retail customer base.

Re: Understanding Coinbase

#122

Post by smeej »

porknubbins wrote: post #71
opportune wrote: post #39

The point of coinbase is to be a normie-friendly, trusted onramp into crypto. It has tons of direct and indirect competitors, many of which will give you better rates or more variety, but none of which have managed to market themselves into the degree of "legitimacy" that people give Coinbase. It is an exceedingly boring business IMO.

I think that Coinbase is kind of the Apple of crypto exchanges. Their trading UI is simplified and opinionated but by having reasonable settings is vastly better than everything else out there.

With the exception of the fact that Apple customer support is much more accessible than Coinbase's, which has pretty much always been its Achilles heel, it's a good comparison.

Re: Understanding Coinbase

#123

Post by smeej »

anonymoushn wrote: post #107
helsinki wrote: post #67

Too tired to read the article, but please, everyone, buy your crypto via Coinbase Pro. The fees are only a fraction of what Coinbase charges.

Is Coinbase Pro really the lowest fee venue in the US?

It depends on your volume, and how you feel about wire transfers.

Kraken USD deposits have to be made by wire, but Kraken's fees[0] are lower than Coinbase Pro's fees[1] at most levels.

[0] https://support.kraken.com/hc/en-us/articles/360048917612-Fe... [1] https://help.coinbase.com/en/pro/trading-and-funding/trading...

Re: Understanding Coinbase

#124

Post by xyzzy123 »

abdullahkhalids wrote: post #120
sudhirj wrote: post #111

This reminds me a lot of the rise of Git in the early days, when decentralised version control made the spectacular promise of allowing people to share diffs directly with each other without going through a horribly centralised system like Sourceforge or any other SVN based service. Of course, nobody wants to send diffs to each other, that would just be silly. We only want the option to do so. So now that we can mirr…

In my country, at least, once upon a time, upper middle class people would use a person/business called "dhobhi" to wash and iron 90% of their clothes. Reasons included convenience, unreliable supply of water at home, low quality consumer detergents etc. For small communities, the dhobhis formed an oligopoly of centralized services. When washing machines became available, people didn't buy them because they were expe…

I'm not sure this analogy holds, exactly, for project hosting.

Washing isn't inherently collaborative, and the more one looks at the specifics, the more divergent the situations seem.

For example, Git(hub/lab) offer free project hosting while running one's own server would incur costs. This can be a big deal for open source, because paying bills or handling money tends to force a more complex structure on your "organisation".

For project hosting, there are network effects in terms of project discoverability, user account management, operational convenience (data durability, patching, ensuring uptime), consistency of interface and third party integration which tend to make using a centralised service more attractive than running your own, all else being equal.

It seems to me that only quite bad mismanagement of the major project hosting services could reverse this trend.

Re: Understanding Coinbase

#125

Post by agumonkey »

smeej wrote: post #118
agumonkey wrote: post #100

Earlier quoted context omitted.

Metamask is the only name I could remember, when you listen to people discuss how to use uniswap, the amount of step to do is quite random and it's full of lingo and basically, it feels like setting up the latest js toolchain, a big shiney blur. Then they'll go on and talk about other systems, like polka dot and its parachains and its another universe, then you have multichains, and oracles and whatever. It's more li…

So is your critique that the tech is just in its early stages of development and hard to use for non-techies right now? Or are you seeing some reason it can't eventually become as easy to use as the internet, even though that was also really complex and hard to use in its first decades?

No it's randomly chaotic and disguised as cute systems and their little world to play with finances.. there's a dissonance to me here.

Also I don't think even the earliest of networking was as weird (but I could be wrong).

Re: Understanding Coinbase

#126

Post by abdullahkhalids »

xyzzy123 wrote: post #124
abdullahkhalids wrote: post #120

Earlier quoted context omitted.

In my country, at least, once upon a time, upper middle class people would use a person/business called "dhobhi" to wash and iron 90% of their clothes. Reasons included convenience, unreliable supply of water at home, low quality consumer detergents etc. For small communities, the dhobhis formed an oligopoly of centralized services. When washing machines became available, people didn't buy them because they were expe…

I'm not sure this analogy holds, exactly, for project hosting. Washing isn't inherently collaborative, and the more one looks at the specifics, the more divergent the situations seem. For example, Git(hub/lab) offer free project hosting while running one's own server would incur costs. This can be a big deal for open source, because paying bills or handling money tends to force a more complex structure on your "organ…

You are right that the analogy fails in a number of ways.

My point is that, besides legal issues that you point out, personal adoption of these services will grow a lot more, if hosting your server was actually easy. Right now, it is not, not by a large margin.

Re: Understanding Coinbase

#127

Post by imtringued »

lottin wrote: post #112
logifail wrote: post #110

Earlier quoted context omitted.

> If your customer is willing to spend BTC they own for your services[..] In this scenario, would one's rate be set in BTC, or fiat? I'm struggling to understand how a (non-crypto) business could want to hire a contractor at - let's say - 0.016 BTC/day, then watch the real (fiat) cost of that rate change value as the crypto markets move. "We hired a contractor at what was $100/day but right now it's costing us $1000/…

It would be foolish for a business to enter into BTC-denominated contracts because that would expose them to a huge foreign exchange risk in return for nothing.

So you're saying these people don't want to use BTC? If they used BTC exclusively for everything this wouldn't be an issue. Dollar denominated contracts only matter if all you have is dollars. By that I mean that if you buy 0.01 BTC today and hold them until the contract is completed then you face zero foreign exchange risk.

If you don't possess the BTC on the day you signed the contract then you basically created an option with a zero dollar strike price. You aren't truly using the currency the way helloworld1 and others imply.

Re: Understanding Coinbase

#128

Post by imtringued »

smeej wrote: post #113
de6u99er wrote: post #90

Earlier quoted context omitted.

Coffeeshops here in NL only accept either cash or plastic.

There's already an entire industry growing up around enabling cryptocurrencies to be spent using traditional payment rails too, though, for those who don't want to see their governments print away the value of their money. Coinbase itself has a debit card that deducts directly from your crypto balance and allows you to swipe the card anywhere that normally takes Visa. They're even a card issuer for Visa in their own…

>for those who don't want to see their governments print away the value of their money.

The sad reality is that governments fail to do so. The irony behind your comment is that if they could, they would have stopped a long time ago.

Re: Understanding Coinbase

#129

Post by lottin »

imtringued wrote: post #127
lottin wrote: post #112

Earlier quoted context omitted.

It would be foolish for a business to enter into BTC-denominated contracts because that would expose them to a huge foreign exchange risk in return for nothing.

So you're saying these people don't want to use BTC? If they used BTC exclusively for everything this wouldn't be an issue. Dollar denominated contracts only matter if all you have is dollars. By that I mean that if you buy 0.01 BTC today and hold them until the contract is completed then you face zero foreign exchange risk. If you don't possess the BTC on the day you signed the contract then you basically created an…

If they used BTC exclusively they wouldn't have foreign currency exchange risk. Instead they would have alternating periods of hyperinflation and hyperdeflation, coupled with highly uncertain tax liabilities, because taxes are still paid with real money. So, not much better. And this is assuming that there are no technical limitations or prohibitive costs preventing the adoption of BTC as exclusive currency.

Re: Understanding Coinbase

#130

Post by jhanschoo »

brianvli wrote: post #6
eruleman wrote: post #2

The biggest threat to Coinbase are decentralized exchanges like Uniswap & Sushiswap. During the peak of DeFi summer, Uniswap handled more trading volume than Coinbase. [0] Uniswap airdropped its token $UNI to all users on Sept 17, 2020. Uniswap is already at a $17 billion market cap. Coinbase is expected to IPO at ~$100 billion. [0] https://www.theblockcrypto.com/data/decentralized-finance/de...

Coinbase is more about turning non-crypto currencies into crypto currencies while UNI/SUSHI are more about turning crypto currencies into different crypto currencies. In my POV, there's only two ways to get into crypto: - Centralized exchanges with KYC - Mining Coinbase is a KYC centralized exchange and enables people to turn their bank account $$s into crypto. Uniswap and Sushiswap are only relevant once someone has…

I'd also add on that Coinbase is in a position to build payment features (e.g. chargebacks) a la Paypal for transactions within their platform, that a DEX cannot provide.
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