When it comes to understanding the safest crypto exchange that can provide trustworthy, reliable, and secure crypto trading platforms, Coinbase is an excellent platform for investing in all types of crypto.
You may still be wondering though: Is Coinbase safe?
Coinbase markets itself as “the most trusted place for people to buy, sell, and manage crypto.” Given its host of cutting-edge security and encryption features, plus it being a publicly-traded, U.S. company, I agree – Coinbase is the safest place to invest in crypto.
You may be wondering, “Is my Bitcoin safe” or “how does Coinbase work”, here’s everything you need to know about the cryptocurrency exchange platform’s security, regulation, and why it’s the best US crypto exchange for beginners.
A word of caution if you do open a Coinbase account, there are plenty of scammers out there that will try to steal your crypto. Coinbase will NEVER call you about your account. So if you do get a call from someone claiming to be from Coinbase just hang up. There are lots of posts out there about Coinbase customer losing their crypto–it is because they fell for this simple scam.
We’ve all read the horror stories about people having crypto stolen. Want to know how to avoid becoming a headline? Keep reading our review to learn how Coinbase protects users and their crypto assets, and you won’t need to worry about it!
What Is Coinbase?
Coinbase is the largest crypto exchange in the United States based on trading volume. It is also the only publicly-traded crypto exchange in the world and also boasts very few Coinbase fees
Coinbase was co-founded in 2012 by Brian Armstrong (a former software engineer at Airbnb) and Fred Ehrsam (a former Goldman Sachs trader). In October 2012, the company launched the services necessary to buy and sell bitcoins via bank transfers.
Is Coinbase Safe to Use?
Given all the concerns around security in the world of crypto trading, you should be asking: Is Coinbase safe to use?
Yes, Coinbase is one of the safest crypto exchanges! Here’s why:
- Coinbase is compliant with US laws and regulations, including oversight by the SEC
- The company uses secure encryption and authentication to keep accounts safe
- They are regularly audited and subject to third-party oversight
The MOST IMPORTANT THING to remember about keeping your assets safe, is do NOT give out your passwords to anyone, especially people calling and claiming to be from a bank, credit card, or crypto exchange. Coinbase will NEVER call you. If they email you it will be from coinbase.com and no other URL. I myself almost got scammed by someone calling and claiming someone in another city was trying to access my account. They started asking too many questions and I hung up on them.
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Is Coinbase Legit?
Is Coinbase a scam or is it legit?
Those are important questions to ask about any crypto platform.
Coinbase is legit, and here’s how we know.
- More than 110 million users in 100+ countries
- $273 billion in client funds on the platform
- $185 billion per quarter in trade volume
- 248 tradeable cryptocurrencies
- Doesn’t lend or take any action with your assets without your permission
- Collects only the minimum amount of personal data it needs to operate as a brokerage
These things prove that Coinbase is legit and illustrate how its different from platforms that have played fast and loose with users’ assets, with a key example being FTX.
How Safe Is Coinbase for Storing Crypto?
Just how safe is Coinbase for storing crypto? We’ll go into more detail later, but here’s a quick rundown of key security features.
- Two-factor authentication (2FA).
- AES-256 encryption.
- Cold storage of funds (98%).
- Insurance policy on custodial assets.
The use of encryption protects both data and assets. Cold storage is essential because it means that most of users’ assets are simply not accessible to hackers.
Coinbase vs Coinbase Wallet: What’s Safer?
Coinbase offers a self-custody web3 wallet. The big question here is, Is Coinbase Wallet safe?
Let’s start with the key differences between Coinbase and Coinbase Wallet?
- Coinbase (Exchange Account): Custodial, insured, platform-controlled security
- Coinbase Wallet: Non-custodial, self-managed, requires personal key management
As we’ve said, Coinbase Wallet is a self-custody web3 wallet. It’s protected with a security phrase you create. Nobody, including Coinbase, can access your cryptocurrency, NFTs, or keys without providing that phrase. There’s a browser extension that’s compatible with Ledger hardware, which provides an additional layer of security.
Here are some additional security measures that Coinbase has included.
- Password protection
- Two-factor authentication (2FA) with biometrics
- Security locks
- Full transparency for dApp transactions and smart contracts
- Automatic spam token management
- dApp blocklist with automatic notifications when you encounter a malicious dApps on web3
- Support for multiple addresses to keep your wallet and web3 address separate
- Permission management to keep your wallet and its contents safe
- Support for Bitcoin, Ethereum, Solana, Dogecoin, and all Ethereum-compatible networks
These security features, combined with the best practices we’ll outline in the next section, provide everything you need to safeguard your digital assets, including cryptocurrencies, tokens, NFTs, and smart contracts. In other words, yes, Coinbase Wallet is safe!
Which One Is Better for Beginners?
We’ve already established that Coinbase is safe, so here’s the low-down to help you figure out: how safe is Coinbase Wallet, and which one (Coinbase or Coinbase Wallet) is better for beginners?
Coinbase and Coinbase Wallet serve slightly different functions. Is Coinbase safe? Yes, it is, but you won’t have as much control over protecting your assets as you would with Coinbase Wallet.
Provided you set a strong password, enable 2FA and security locks, and manage permissions to make sure nobody else can access your wallet, we think the Coinbase Wallet is the safest option for beginners as well as for more experienced crypto traders.
How Does Coinbase Protect Your Account?
Here’s a list of the majority of protections Coinbase offers to all its users that outline it’s robust security measures:
- Two-factor authentication (2FA) – Sign in with your email and password, then receive a text, call, or email to confirm it’s you trying to access your account.
- Password management – Your account passwords are encrypted and unreadable, and are stored offline.
- Enhanced account protections – Coinbase monitors third-party data breaches and darknet markets for threats. If one is detected, your login credentials are automatically secured.
- Lock My Account – If you notice any suspicious activity, you can lock your account and prevent further activity.
- Coinbase Vault – The Coinbase Vault allows you to receive cryptocurrency like a normal wallet but you can set up optional security steps to prevent stored crypto from being withdrawn.
- Proactive security notifications – For all major security changes, Coinbase will notify you and give you the option to lock your account.
- Behind the scenes – Coinbase deploys machine learning models to evaluate your transactions and will give you the option to cancel a transaction if things don’t look right.
- Security Prompt – Security Prompt is an optional 2FA method which is simpler and faster than other methods.
Cloud Storage Accounts
Coinbase offers a lot of work behind the scenes, so their customer support team is capable of detecting and try to stop SIM-swap (ATO targeting) on all customer accounts.
It’s also best practice to in using a SMS-based two-factor authentication (2FA), which is better than using no 2FA at all!
Private Keys
The Coinbase app has all of these security features and more (including dedicated Coinbase employees with remote access), when it comes to maintaining the self-custody of customer’s private keys. All private keys are securely held and hosted via digital wallets (assigned to customers when creating an account on Coinbase). The only difference is whether you choose to use a Coinbase Exchange Account vs. Coinbase Wallet in regards to a security team.
When using one of Coinbase’s many products, like the Coinbase Wallet, you are responsible for maintaining your private keys (which mean self-custody for Coinbase users).
If you’re wondering, ‘Is Coinbase secure?’ the answer should be simply clear, yes.
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Regulatory Compliance: Why It Matters
There’s been a lot of contention between cryptocurrency exchanges and the SEC, and Coinbase is no exception.
Until February of 2025, there was a civil lawsuit pending, filed by the SEC against Coinbase. The allegations were that cryptocurrencies are securities and should be subject to SEC regulations. Coinbase maintained that cryptocurrencies aren’t securities and require separate regulations.
In February, the SEC asked for its lawsuit to be dismissed and announced the formation of a new Crypto Task Force to determine what regulations are needed to keep crypto traders safe.
We appreciate that Coinbase isn’t claiming it shouldn’t be regulated, but that the regulations that apply to securities aren’t the right ones.
- Regulations are necessary to protect traders from malfeasance
- Third-party audits ensure that Coinbase is doing what it can to protect users and their assets
Ultimately, compliance with regulations is essential to protect users from fraud and unfair business practices.
Best Practices for Keeping Your Crypto Safe
Coinbase compiled a list of its top 5 cryptocurrency security tips to protect digital assets in your account.
- Set strong, unique passwords
- Use the most secure version of 2FA available
- Never give anybody access to your computer or share your credentials, even with a security team
- Write down your private keys on a piece of paper and store them in a safe place
- Don’t post about your crypto holdings online or on social media
While the crypto market is fraught with malicious activity, following these 5 steps can greatly reduce your chances of being the victim of a scam or attack.
Final Verdict: Is Coinbase Safe?
There are lots of crypto exchanges to choose from, and it’s essential to choose one that’s safe and secure. So, is Coinbase safe?
Yes!
Not only do we know that Coinbase is safe, we believe it’s the safest and most legit platform for crypto trading in 2025.
Beginners and advanced traders alike will benefit from Coinbase’s robust security features. The same is true of Coinbase Wallet.
So, what are you waiting for? If you’re interested in crypto trading and you want a secure place to buy, sell, and store your digital assets, we trust Coinbase!
If you are looking for comparisons: Gemini and KuCoin are other popular options for staking crypto, in addition to newcomer Uphold (read: UPHOLD VS COINBASE).
Create a Coinbase Account Today
Receive up to $200 Free in Bitcoin
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Frequently Asked Questions
Yes, Coinbase has a number of robust security measures, to keep your sensitive data safe. For instance, all account and routing numbers are stored using bank-level encryption.
Because it is US-based, publicly-traded, and is on the cutting edge of crypto security solutions, Coinbase consistently ranks as the safest crypto exchange in the world. That’s why it’s trusted by more than 100 million crypto investors.
Yes, you can trust Coinbase.
The cryptocurrency landscape is ripe with fraud, scams, and hacks (not to mention extreme volatility), so you should approach investing in cryptocurrencies with caution. That said, Coinbase has one of the strongest suites of security measures to protect its users, including AES-256 encryption, 2-factor authentication, and even offline storage for asset storage.
Read our COINBASE REVIEW to see why they’re one of the top exchanges of 2024 for buying bitcoin and beyond!
Coinbase digital wallets are non-custodial, which means the company can’t access them (unlike what happened at FTX). This type of wallet is safer because only the owner of the wallet has the private keys needed to gain access to it.
Coinbase stores user data, including wallet addresses mobile account name, in offline wallets, which makes them less susceptible to hacks than online wallets. Users’ private keys are secured with bank-level encryption.
That said, because Coinbase holds billions of dollars in crypto and hundreds of millions of users’ data, it is a prime target for hackers. That’s why most savvy crypto investors recommend keeping your crypto in a self-custodied wallet, which adds an additional layer of security, rather than leaving it on the exchange.
While Coinbase is probably the safest and most regulated crypto exchange and you’ll more than likely be fine staking your crypto on Coinbase, most crypto experts hold their crypto investments in offline, self-custodied wallets to add an additional layer of protection.