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So if I understand correctly, coinbase creates a private internal "wallet" for you, "hidden" from the public ledger, and owns the private key to it?

Thank you, it's funny how GP talks about an "open, interoperable network" then...

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For what its worth, this is only for convenience purposes for those who want to use Bitcoin without having to handle managing their own keys (ie. grandma and grandpa) or want to avoid transaction time/costs that come with operating on the blockchain.

Coinbase offers multi-sig support which puts control back into the user's hands in the event Coinbase went down or was compromised.

Coinbase is a great service for acquiring coin but I generally move it out to my preferred wallet after I purchase it.

Yes. As I understand things, Coinbase provides at least two major services. They're a major US USD<-->BTC exchange, and they also host wallets.

Those things are separable, as you can make a USD->BTC exchange, then transfer to another wallet for safekeeping, or do the reverse to get back to more-traditional currency.

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