GDAX Review – Coinbase vs GDAX

gdax.com review & fees

Mid-year 2016, Coinbase decided to rebrand its Coinbase exchange to GDAX – Global Digital Asset Exchange – in order to cater towards institutional and professional investors. The main focus behind the rebranding was to not only highlight the added capabilities but the worldwide interest that the exchange provides to traders.

GDAX offers a wide variety of digital currency trading pairs, including bitcoin, Ethereum, and other major cryptocurrencies over popular fiat currencies like the USD, GBP and EUR.

The company is insured and backed by some of the biggest investors in the industry – like the New York Stock Exchange, Andreessen Horowitz, and Union Square Ventures.

This doesn’t mean that Coinbase has rebranded its entire business. To better highlight the difference between these two products:

  • Coinbase is a place for consumers to easily buy, sell, and store digital currency.
  • GDAX (formerly Coinbase Exchange) is an exchange for professionals to trade digital assets.

Adam White of Coinbase wanted to make the distinction between the two products clear, he said, “Coinbase is designed for retail customers while GDAX is focused on serving sophisticated and professional traders.

The company is still focused on its original mission of providing the ability to easily buy, sell and exchange Bitcoin to those more non-technical and casual users, and they will continue to do that through their existing Coinbase product.

GDAX Countries Supported

Today the platform is available in 32 countries; United States, United Kingdom, Canada, Singapore, Austria, Belgium, Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Finland, France, Greece, Hungary, Ireland, Italy, Latvia, Liechtenstein, Malta, Monaco, Netherlands, Norway, Poland, Portugal, Romania, San Marino, Slovakia, Slovenia, Spain, Sweden, Switzerland.

Accepted Payment Methods at GDAX

GDAX is one of the world’s most popular digital asset exchanges. U.S. customers residing in a supported state can deposit USD directly from their bank account via ACH transfers.

Bank wires are also available to all the customers. Bank Account deposits made to the exchange are sent via the ACH bank transfer system, which typically takes 3-5 business days to complete after initiating a purchase.

You can also easily transfer funds from your Coinbase wallet to GDAX account instantly for free. Deposits to GDAX are unlimited, however withdrawals from GDAX are limited by your exchange withdrawal limit, which starts at $10,000/day.

You could however apply to increase your withdrawal limit at: https://www.gdax.com/settings/limit-increase

GDAX Transaction Fees

GDAX’s fee structure is quite straightforward:

  • Maker Fee: 0% (all volumes)
  • Taker Fee: 0.25% (volume-based discounts can drop this fee to as little as 0.1% for traders who trade more than 113,432 BTC in a 30 day period)

GDAX Fees vs Coinbase

We recommend buying and selling bitcoin and other cryptocurrencies via GDAX to save on fees. Coinbase is simple and instant but the consequence to that is higher fees. GDAX is a trading platform that is a bit more like buying/selling a stock but you can save on fees.

Example GDAX vs Coinbase Fees Table

SiteFee PercentageExample Fee ($4k/BTC & Selling 5 BTC)
GDAX (if maker)0% 0
GDAX (if taker).25% $50
Coinbase1.49%$298

What is a maker vs taker on GDAX?

If you place a market order on GDAX then you are considered a taker (.25% fee). If you place an order that isn’t immediately matched then your trade is added to the order book. When the transaction does take place it’s because there was a taker that placed an order and you are considered the maker of the order (0% fee).

GDAX Features

1. A great trading platform

GDAX’s world-class interface provides real time order books, charting tools, trade history, and a simple order process so you can start trading immediately.

2. Insurance

GDAX holds its digital assets in fully-insured online storage. Customer funds are FDIC insured, which means each customer is entitled to up to $250,000 in remuneration in the event of a loss.

3. API Support

GDAX’s Websocket feed lets traders easily gain access to real-time market data. It’s trading API allows for the development of secure, programmatic trading bots.

4. Trusted and Secure

GDAX undergoes regular IT security and financial audits. Plus, they keep 98% of users’ funds offline in cold storage.

5. Low fees

GDAX charges 0% maker fees and taker fees as low as 0.1%.

6. Multiple Fiat And Cryptocurrency Pairs

GDAX offers a wide range of fiat and cryptocurrency pairs, including BTC/USD, ETH/USD, LTC/EUR, LTC/USD, ETH/BTC, LTC/BTC, BTC/GBP, and BTC/EUR, to name a few.

7. Margin Trading

GDAX offers margin trading with leverage up to 3x (on BTC/USD and ETH/USD pairs, up to a limit of $10,000), or 2x (for BTC/EUR pair up to 3,000 EUR, and for LTC/USD pair up to $500).

Controversy

Three months ago in June, Ethereum price on GDAX went as low as 10 cents from $319 for a few seconds. This happened due to a multi-million dollar sell order on the exchange.

When this sell order came in, it needed to be matched with the buying orders – which brought the Ethereum price to $224 from $317.

But because this sell order was so huge, it created a domino reaction all the way down the order book. As each margin position was forced to liquidate, it ate up all the buy orders, which sent the price down further more triggering more liquidation orders — all the way to $0.10!

This flash crash created a big controversy in the crypto world. All the investors that got liquidated were taking out their frustration on online forums.

Three days later, GDAX released an official statement clearing suspicion of any foul play and stood by their trading engine, which they believe worked as intended during the event. Approximately 800 stop loss orders were liquidated in the process.

In the aftermath of flash crash, GDAX released a second update on their blog, ensuring that they would compensate those who directly got affected as a result of the rapid price movement.

They credited their customers’ accounts who had stop losses executed from their own pocket, and also honored all buy orders that were filled — an estimated loss of $9.47 million.

This event really took a lot of people by surprise. No one really expected GDAX to return back the losses that occurred without any fault of their own. Just goes to show at what length the exchange went to keep its customers satisfied.

GDAX Conclusion

It is clear that GDAX is designed to cater to more professional traders. Anyone looking to just buy and sell Bitcoin and Ethereum can easily use either Coinbase or GDAX. Those who want convenience can opt for Coinbase, but traders who are looking for more sophisticated trading must turn to GDAX.

It is good to see both the exchanges exist focusing of different markets. GDAX is popular among traders for its low fees, offering 0% maker fees and taker fees starting at 0.25%.