Global Digital Asset Exchange (GDAX)

GDAX is a well-established cryptocurrency exchange launched in May 2016 by Coinbase Inc.and is based in San Francisco. Currently, GDAX is one of the highest volume exchanges and operates in the US, Europe, UK, Canada, Australia and Singapore.

Website: https://www.gdax.com/

Key Features

Well-Established Brand

Coinbase Inc. is one of the best established and most trusted brand in the crypto market. They currently store approximately $9B of crypto assets on behalf of Coinbase and GDAX customers and are the leading digital currency company.

Experienced Team

They have approximately 200 employees working across three offices in New York, London, and San Francisco. With GDAX and Coinbase under their belt, it is safe to say that this is one of the most experienced teams when it comes to centralized crypto exchanges and crypto brokers.

Institutional Investor Focus

GDAX offers accounts for institutional investors, which have higher withdrawal limits. They also offered margin trading for a short period of time, however, disabled it after a series of margin funding liquidations lead the Ethereum price to drop from over $350 to as low as 10 cents within a few seconds. So we might see Margin Trading making a come back on GDAX in the future.

Furthermore, GDAX recently announced a partnership with Trading Technologies (TT), a global leader of trading software. Beginning this March, TT customers will be able to use the TT platform to trade directly on GDAX. This means thousands of institutional investors will be able to trade via TT on GDAX, alongside nearly 45 other markets, including the CME Group which offers Bitcoin futures.

Fiat Custody at Banks

US dollar fiat funds you submit to GDAX are held in anonymous FDIC-insured banks located in the US, or in US treasuries. Euro and GBP fiat funds are also held in segregated, custodian bank accounts, but are not FDIC-insured. Nonetheless, even if Coinbase and GDAX were to fail as a business, the funds held in the custodian bank accounts could not be claimed by Coinbase, GDAX or its creditors, and would be returned to you.

0% Fee on Sell Orders

GDAX charges users no fees on sell orders, no matter how large their trading volume is.

Buy Order Fee Rebates

At GDAX, all users are eligible for fee rebates on their buys if their trading volume exceeds certain thresholds. While in general users pay 0.25% fees, users that exceed 1% of the monthly total exchange volume (~1,550 BTC as of February 2018) pay 0.24% fees, users that exceed 2.5% (~3,890 BTC as of February 2018) pay 0.22% fees, and so on.

The user’s volume and fees are calculated on the basis of the preceding 30 days, and for each order book separately.

No Wire Transfer Deposit Limits

When using Wire Transfers, there are no limits on fiat deposits for both individual and institutional users.

Downsides

Centralized Architecture Security

Due to its centralized architecture, you need to deposit your tokens and coins to the exchange in order to trade with them. A single hack could mean a loss of all your tokens. As an added security measure, GDAX holds only 2% of your tokens online, with 98% offline in Cold Storage to minimize the risk of loss from hacking. GDAX is insured to the extent of being able to cover the 2% of tokens in case of a security breach or hack, employee theft, or fraudulent transfer.

Nonetheless, experts recommend holding cryptocurrencies offline in your own Hardware Wallet and not on a centralized exchange.

ACH & SEPA Deposit Limits and Duration

GDAX determines your ACH or SEPA deposit limit from your account age, buying history, and account verification for both individual and institutional accounts. Furthermore, those deposits take usually 3 to 7 business days. However, there have been reports from users who waited for weeks for their funds to show up on their GDAX account, without getting a response from the GDAX support.

Coinbase recently announced a deal with the bank Barclays, so this might be improved in the near future, at least for UK customers. Furthermore it was granted an e-money license by the U.K. regulator the Financial Conduct Authority (FCA), and adds support for the Faster Payments Scheme (FPS) soon.

Fiat Withdrawal Limits

GDAX severely limits the amount users can withdraw per day to $10,000 for individual accounts and $50,000 for institutional accounts. This applies to ACH, SEPA and Wire transfers.

No Independent Security Audits

GDAX does not conduct independent audits of their trading platform, which could lead to security issues.

Limited Range of Tokens/Coins

Currently, GDAX offers only Bitcoin, Ethereum, Bitcoin Cash and Litecoin for trading. It is planning on adding more tokens and coins in the near future, though no exact dates or details are known at the time of writing this article.