Coinbase grew 15x in the past 3 months | Hacker News Reader

Coinbase grew 15x in the past 3 months

blog.coinbase.com

96 pointsbarmstrong45 comments

Coinbase has been a serious slug in the bitcoin space.

"Most days we’ve been reaching our maximum amount of buys within an hour or two. Some fixes for that are in the works."

Yeah, customers have noticed and moved elsewhere. The giddy "oh we're growing so fast we can't keep up" worked for the first month. Now it just seems incompetent. Top that off with all the complaints about execution-time pricing, where execution time is some undetermined time up to a few days out, transactions being endlessly stuck in the system, and delays in moving bitcoins and funds, and you've got a dog of a Bitcoin player.

Sorry, these guys need to get it together fast and stop with the juvenile dismissive language for their very serious technical underperformance.

Where else is there for US customers to move?

Pretty much any exchange... I use Dwolla to MtGox. Not ideal, but beats the hell out of Coinbase.

Getting approved on MtGox is a major source of friction.

You only need to get approved if you're going over $10,000 USD monthly.

If you were doing that much in BTC trading each month, I doubt you'd use an unreliable platform like Coinbase to start with.

Is that so? I signed up for an account a few months ago, and from what I could tell I was unable to do anything other than link my Dwolla account and read the instructions on how to submit photo ID to get approved.

edit: I just checked. It's still the case. I cannot transfer money (USD) from Dwolla to MtGox without sending MtGox my photo id.

If you just want bitcoins: Dwolla to CampBX. If you want altcoins: Dwolla to CampBX to BTC-E

I read you have to have your Dwolla linked to your bank account for over a month to use CampBX. I just set up my Dwolla to bank over the weekend and verified. I want to buy a bitcoin or two for fun. Any ideas?

Not true - I had my Dwolla account for less than that before I transferred a bunch of money to CampBX - note that unverified accounts on CBX have a maximum daily transfer limit of $1k

Also, if you're interested in grabbing a bitcoin or two, I'll do it for a fellow HN'er for no markup. E-mail me at hi.im.edward [at] gmail for more info.

Edit: Just realized there's no PM feature on the site - email me :)

I found bitinstant worked well for funding my mtgox account.

I've only ever used BitInstant, granted, it was back a few months ago when you could buy several for under $100, but the convenience of paying in cash at WalMart was pretty cool.

My MTGox account ended up being funded quickly as well. I'd definitely recommend them.

>I read you have to have your Dwolla linked to your bank account for over a month to use CampBX.

That's a recent development, though not one that's going to go away I'm afraid.

>I want to buy a bitcoin or two for fun. Any ideas?

# Person to person exchange? Or

# MoneyGram -> Bitinstant (fees! ~6% plus a trip to a store).

# CampBX will take a personal check! Also USPS money orders or see: https://campbx.com/faq.php#fund-transfers

Exactly. Coinbase seems more and more like a starter science kit -- I used them to buy my first 10 bitcoins because it was easy, then realizing how hard it was to buy more at certain times, and not being able to keep money in your Coinbase account (all transactions get drawn from your bank account and take X days to clear before you can actually do anything with your BTC and when you sell BTC they get deposited into your bank account) took its toll. I now deal solely with the exchanges (MtGox, CampBX, BTC-E) - it's so much easier, and I think people also fail to realize there's a markup with using coinbase too.

Actually there are additional costs to using Mt Gox and other exchanges as well.

Aside from monetary ones, I know from experience that Mt Gox has horrible customer service. The size of their operation does not match the level of customer service required. Granted, banks suffer the same but at least they have B&M presence.

Sorry to hear that - agreed, it seems like the best support for all these exchanges is to not need it, because good luck getting a response. I've even seen situations with BitInstant where e-mailing them is pointless, but starting a reddit thread in r/bitcoin is the best way to get a response. This needs to change if Bitcoin is going to be the currency o the future.

Agreed 100%.

I decided to finally buy a bitcoin for fun. I entered my personal information, verified my bank account, tried to buy one bitcoin after waiting a week for capacity reasons -- then I get an email saying that they can't fulfill my purchase for some generic "security" reason. This was after another 5 day wait.

Real poor experience, can't say I feel the urge to try again with them anytime soon.

It's not uncommon for services that are growing fast to be overloaded. Twitter is a famous recent example. Empirically it seems to be a predictor of success. Off the top of my head, I can only think of one startup (Friendster) that died because it couldn't handle its own popularity, and that was a pretty extreme case.

Friendster was the extreme case because, of the poor management behind the company. For instance, they went through 4 CEO's over a short period of time and they chose to do a full rewrite from Java to PHP instead of trying to scale the service and because, the rewrite wasn't implemented properly it had to be rewrote again a couple of years later. Moreover instead of sharding/portioning, Friendster chose to scale their service by purchasing an SAN and using daisy-chained MySQL which resulted in considerable slave lag. For comparison, Facebook on the other hand used colleges to "portion" their database in the early stages of the company.

Instead of doing the rewrite, Friendster should have focused on trying to scale the service like Twitter did by bringing in PivotalLabs - if Friendster sharded their database for instance it would have helped them immensely and may have resulted in a different outcome for the company.

The way Coinbase is behaving is actually costing people money though, and if you look at the Bitcoin forums users have been pissed for months. They haven't just been having capacity issues letting people buy Bitcoins either; even once users have got Bitcoins into their account there's been problems with them delaying payments out, to the point other services have been telling people not to pay from Coinbase: http://blog.bitpay.com/2013/03/applying-late-transactions-to...

The combination of this being a financial institution, there being more robust competition, and the absence of lock-in might make this an exeption. I hate to be critical like this, but there have been months of user complaints and nothing but upbeat rhetoric in response.

Granted if Coinbase builds a solid product, this will all be dust on the road. The competition is not "good enough" yet.

And I wish I could delete this. I don't really want this negativity to be the top-rated comment.

It's not just a technical problem. You've got a couple guys in an incubator, moving in with a few thousand dollars funding to start a website, who suddenly have to figure out how to safely float X million dollars in currency exchange on a rapidly fluctuating market with a huge ask/bid gap. If they overextend themselves too far on the BTC pool they hold in front of a spike/crash, they have no capital to correct, they could go under overnight.

You're right - we need to improve in all these areas. We're interviewing 2-3 people a week right now to keep scaling things out as fast as we can.

At this point our only options are to grow slower and focus on reliability. Or keep up with demand, and have there be a few rough edges.

Just want to mention this is mostly due to increasing awareness about bitcoin generally (as opposed to anything specific we are doing). People are getting really excited about bitcoin, which has been great for us and the community generally.

Do you have ways of augmenting your daily buy limits as a company? Or will your transactional capacity be capped at the rate you've been managing during the past three months?

Well the lack of ability to actually buy coins via Coinbase is certainly something specific you're doing. I know personally a few thousand dollars were not sent to Coinbase because Coinbase simply cannot accept transactions most of the time.

I'm shocked that months of running the service, and it's still very difficult to buy, and the only remedy is to try at specific times. It seems terrifically incompetent, despite the continual "we know and we're working on it!" line.

At the very minimum, you'd think you'd email customers that attempted a purchase to tell them you have capacity open. Or let them reserve. Or really, anything but what you're doing.

Every time we add capacity, we max out again in a week or so.

We are 3 people total, servicing 120,000 customers. We could start wait listing new users into the service, but there are many of them who get value out of the product as it is, so it doesn't feel like the right solution.

I think the problem people have (including myself) is that the messaging around the problem is horrible. We see this error, over and over, with no solution, and a "we know" response. An update on the blog and emailed to customers, explaining how tens of thousands of people sign up per week, how you've upped your purchasing by 100% a week -- that'd go a long way. A note on solutions you've considered but can't implement would also be helpful in getting your customers on your side. People will be far more understanding if they're given a reason. Most of them want to see Coinbase succeed.

I still don't see why someone shouldn't be able to reserve a purchase, even if for a 15-minute time period. Or change the limit per-account so that more people can get a piece.

And I still can't make a bit coin acquisition on the site...

Gratz, guys. Big fan of coinbase and its ease of use. The only problem is, I feel like there is a limited lifetime value on any coinbase user, because as soon as you want to do more complicated trades, you need Mt. Gox or another trading platform.

Does anyone know the type of charting / dashboard software they are using there to display those graphs. There is also the "Add to dashboard" option which makes me think this is a SaaS product they are using in their backend.

Some quick investigation and I'm pretty certain its:

http://www.statsmix.com/

Yes, it's definitely StatsMix (I'm the founder and former CEO - we recently sold the business).

but given that price of bitcoins has skyrocketed over the past 3 months, what's your actual growth in bitcoins being processed, not just dollar amount?

Largely meaningless. BTC, as currently used, is essentially a USD proxy, because just about every BTC retailer prices in USD, and then just charges however much BTC at the current(ish) exchange rate.

I'm bullish on Brian, his team and Coinbase as a product.

Given the recent high-profile flameouts, I'd rather see people disappointed they can't use all aspects of the service today than none of them down the road.

Bitcoin is still early and I don't think that the market of products and services is outpacing the company.

Coinbase has really impressed me with what they've done and how they've managed growth. Its a tricky market, especially with the exploding popularity.

Uh, is this extrapolating off of a one day peak? Given how inconsistent the whole bit coin market is, I'd want to see more than one data point.

The trend in that graph is incredibly promising either way.

Promising in what way? It shows that Bitcoin is gaining more popular attention, which is translating into increased sales for Coinbase.

The issue is that Coinbase has some serious flaws that make it immensely unappealing to any serious Bitcoin enthusiast.

If you go to some Bitcoin communities and search Coinbase, you'll just see an endless stream of negative opinion.

(Reddit search for Coinbase, first 5 results are complaints: http://www.reddit.com/r/Bitcoin/search?q=coinbase&restri...

The same search on bitcointalk.org shows similar results )

It'd be more promising if they showed returning buyer stats; i.e., those who bought a BTC and then returned the next month, let's say, to buy more.

I'm kind of disappointed in Coinbase. I really hoped they would be a serious competitor to Mt. Gox, which would be a great thing for Bitcoin.

Not to my eyes. After the early April surge, you could easily make a case that it's shrinking. At the very least, the peaks camouflage much slower than 15x growth.

The strong points of Coinbase are the ease of use and the merchant APIs. Keep polishing the trading part and you'll be in this for the long run and the biggest share of a billion dollar market.

Are they being DDOSed?

I'd love to see this data plotted vs the average Exchange Trade Volume over past 180 days:

http://blockchain.info/charts/trade-volume?timespan=180days&...

If you correct for that HUGE spike to 1250k in the CB graph it looks like CB is almost trending exactly w/the other exchanges.

Oh I bet they did lol

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