In the move announced recently, Coinbase said it would be limiting the minimum amount UK investors could deposit to £1,000, and that it had removed the UK Faster Payments Service, which allows customers to quickly and easily buy popular cryptocurrencies like Bitcoin and Ethereum.
Instead, UK customers will now have to use the standard international option, that is transferring money using SWIFT.
This leaves UK retail investors with the following options:
- Debit card: an extremely expensive option with high fees.
- SEPA: expensive (need to convert from GBP to EUR), and slow.
- SWIFT: £10k minimum, expensive and slow.
With this move, Coinbase is slamming the door in the face of UK retail crypto investors, making it clear that as a market the UK is pretty far down the list of Coinbase’s priorities.
It’s a shame because UK retail investors have helped make Coinbase the success story it is today. By making withdrawals even slower and by raising the minimum deposit to £1,000 they have effectively closed themselves off the UK retail investor market.
As the Coinbase ship begins capsizing, Coinbase Pro customers are given life jackets, handed rubber rings and escorted to the boats first, before any regular Coinbase user.
If there was a systemic fault with the Faster Payments technology, Coinbase Pro users would also be affected, but this is not the case.
The same customers who turbocharged the growth of Coinbase, are the same customers who are left to hang out to dry.
To compensate UK investors Coinbase says it is offering reduced trading fees for two weeks in recognition of customers’ loyalty.
But UK customers are not stupid. This is a prime example of Coinbase utilizing their position to ‘give with one hand, but take with another’.
Now, if I want to deposit £200, the only feasible option is via card payment, a method which will cost me 4% for the privilege. If they offered me zero trading fees, or even some cashback on a £200 trade it would still result in a net loss.
With a 1.6 rating (and that’s out of 10) on Trustpilot they are quickly becoming the butt of every joke in the crypto space.