> Unfortunately, for transactions between two Bitcoin addresses that are on the Coinbase network, Coinbase will perform an internal transfer of funds. The transaction is never pushed to the blockchain, avoiding the need to pay Bitcoin fees, and making payment confirmation instantaneous.
Wait... what? how does this work? didn't the wholepoint of using Bitcoin is that there is a public ledger for every move? Looks like Coinbase find a way to act like a real bank on the bt network.
It's actually a pretty nice value add - you don't have to pay transaction fees, nor wait for confirmations. Of course, this assumes the implementation is competent, which seems to be under question in this case.
I came here to say exactly this, and before doing so thought to ^F first. Heh.
The other two comments I see in this subthread are practical and pragmatic, but I also agree with your view as well. I would far prefer to pay the fees and have all transactions processed via the blockchain.
Although at the end of the day, pragmatism makes money...
The problem is that when you are putting money in Coinbase you are basically loosing your biggest asset on the btc network... trust; You have to fully trust that Coinbase won't transfer your btc's to another "internal" account.
Wait... what? how does this work? didn't the wholepoint of using Bitcoin is that there is a public ledger for every move? Looks like Coinbase find a way to act like a real bank on the bt network.