The popularity of cryptocurrencies has sky-rocketed in the past two years, and with a fast growing community, comes increasing demand. Coinbase, the largest US crypto exchange, is struggling to meet these demands and lengthy waiting times are becoming commonplace.
During a turbulent few weeks – which has seen Bitcoin’s value plummet – Coinbase has been subject to thousands of complaints by investors due to waiting times on transactions and a lack of clear communication.
Online message boards are packed with complaints from angry and concerned investors. One claimed that when he called his bank to query why his transaction had not arrived, staff at TSB had advised that Coinbase were ‘Swamped’ and that the bank had been inundated with calls relating to transfer delays.
The problem lies primarily with the exchange’s manpower, and their inability to grow in line with their popularity. Coinbase’s value has skyrocketed to $1.6 billion, driven by a surge of investors looking to cash in on the explosive growth of crypto currency. But there are now clear signs that the exchange is struggling to cater for their new demand.
Through Coinbase, investors can buy four of the largest crytpo currencies (Bitcoin, Ethereum, Litecoin & Bitcoin Cash) using mainstream fiat currency.
Investments can be purchase either via credit and debit cards or via a bank transfer. Coinbase recommends card purchases are used for small purchases, but that bank transfers are used for large transactions to avoid a 4% fee levied on card transactions.
According to the Coinbase website, customers can deposit money using Single Euro Payments Area (SEPA) transfers with a maximum waiting time of 1-3 working days. The waiting time for withdrawals is listed as 1-2 working days.
However, investors across the globe are now complaining of far longer waiting times to access their money. A quick scroll through the Reddit Bitcoin community reveals hundreds of posts detailing investors painstaking wait – which can be up to several weeks.
Waiting times such as these are counterproductive and highly damaging to investors. The fast-paced, tumultuous nature of the market means that investors want the capacity to be able to buy and sell quickly. And with such uncertainty about waiting times, naturally there comes a lack of confidence within the community.
Reddit users have even begun to raise concerns of the reputability of Coinbase.
One user said:”Get your money out and go somewhere else, seriously. I thought they were a reputable company, I had a week of things being straightforward and now I’ve been locked out for a week with my funds/coins trapped.”
“I can’t believe how shocking Coinbase is. It makes me think I’m mad and that this is all one big scam!” said another.
Coinbase taking action
Coinbase Chief Executive, Brian Armstrong addressed customer concerns in a blog post, stating: “The engineering and ops teams at Coinbase have been working around the clock. I realize that updates are no solace when you can’t get prompt response from customer support.”
The San Francisco-based company has grown continuously and adapting in its ability in order to meet demands. Since 2017 Coinbase has increased its customer support staff numbers by nine times, and its hourly transaction capacity has grown 77 times.
Coinbase is bringing in more technical talent in the shape of team-based note service company Memo.ai – an acquisition that could greatly improve the company’s services. This move brings on much needed technical expertise and could help alleviate the pressure placed upon the current team.
— Coinbase (@coinbase) January 17, 2018
In addition to the acquisition of Memo.ai, Coinbase has hired Twitter executive Tina Bhatnagar as its new vice president of operations and technology. Ms Bhatnagar’s first action in this role will be to expand the customer service personnel at the firm from 200 to over 600, stating:
“Let’s grow fast but let’s also grow smart.”