What Are Coinbase Vaults?
Coinbase, a leading cryptocurrency wallet provider, has expanded its services by launching Vaults—a secure storage solution designed for long-term bitcoin holdings. Unlike standard wallets meant for daily transactions, Vaults function like a savings account, offering enhanced security features for larger bitcoin investments.
Key Features of Vaults:
- Time-delayed withdrawals to prevent unauthorized access.
- Multi-approval withdrawals, requiring multiple user verifications.
- Offline storage (cold storage) with 97% of funds kept offline in geographically distributed vaults.
- Future multi-signature technology for added security (coming soon).
Why Use Vaults Over Regular Wallets?
Coinbase recommends dividing bitcoin storage based on usage:
- Wallets: For small, day-to-day transactions (e.g., mobile app payments).
- Vaults: For long-term savings or significant investments, prioritizing security over convenience.
"A wallet is like cash in your pocket—handy for daily spending. A vault is your savings account: withdrawals are slower but far more secure."
— Coinbase Blog
Security Enhancements
Coinbase’s cold storage technology ensures most assets remain offline, significantly reducing hacking risks. Additionally, Vaults include:
- Geographically dispersed storage in private facilities and safe deposit boxes.
- Transparent audits of offline reserves for user confidence.
Pricing and Availability
- Cost: Free (same as standard wallets). Coinbase charges a 1% fee (or less) for buy/sell transactions.
- Rollout: Initially released to 5% of users, with full availability expected by July 16, 2014.
FAQs About Coinbase Vaults
1. How do Vaults differ from regular Coinbase wallets?
Vaults are optimized for security with delayed withdrawals and multi-approval processes, while wallets are designed for frequent, small transactions.
2. Is cold storage really safer?
Yes. Offline storage eliminates exposure to online threats like hacking, with 97% of funds kept offline.
3. When will multi-signature support be added?
Coinbase plans to introduce multi-signature technology after internal and external testing.
4. Are there fees for using Vaults?
No. Vaults are free, but standard transaction fees apply when buying/selling bitcoin.
5. Can I cancel a withdrawal from a Vault?
Yes. The time-delay feature allows cancellation before the withdrawal processes.
6. Who can access my Vault?
Only users with pre-approved permissions can initiate withdrawals, adding an extra layer of control.
👉 Discover how Coinbase Vaults can safeguard your bitcoin investments