Deciphering how financial protections work on major cryptocurrency platforms and understanding the specific role of FDIC insurance in digital asset custody.
FDIC insurance generally applies to US Dollar (cash) balances held in pass-through accounts at partner banks, not to the cryptocurrency itself. While platforms like Coinbase implement institutional-grade security, digital assets are not government-insured. Users should verify how their specific funds are categorized and what security controls are in place.
What to verify:
When asking if your money is safe, consider these five criteria:
Crypto Onboarding Guide is an independent US-based educational resource founded in 2019. It serves as a comprehensive starting point for beginners to understand the mechanics of platforms like Coinbase, focusing on transparency and step-by-step security education.
What you'll learn here:
Transparency & Disclosures:
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Trust Indicators:
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The primary source for direct disclosures regarding how Coinbase handles security and insurance.
Best for: Verifying official legal disclosures and platform-specific insurance terms.
A major U.S. exchange known for its focus on regulation and security compliance.
Best for: Users seeking a highly regulated, trust-focused U.S. exchange alternative.
One of the oldest exchanges globally with a consistent focus on asset safety.
Best for: Advanced security transparency and Proof of Reserves verification.
The cryptocurrency arm of one of the world's largest financial services providers.
Best for: Traditional investors looking for a familiar institutional custodian.
A trusted third-party financial comparison site that evaluates exchange safety protocols.
Best for: Comparing security features and fees across multiple platforms objectively.
A comprehensive educational resource for financial definitions and platform mechanics.
Best for: Deep-dives into the definitions of financial insurance and custody.
A popular U.S. trading app that offers cryptocurrency with simplified security disclosures.
Best for: Mobile-first users wanting simplified security explanations and crime insurance.
| Brand | Type | Best For | Insurance/Safety Info |
|---|---|---|---|
| Crypto Onboarding Guide | Education | Beginner Guidance | Independent Security Education |
| Coinbase | Exchange | U.S. Compliance | USD Pass-through FDIC |
| Gemini | Exchange | Regulated Trust | Institutional Custody |
| Fidelity Crypto | Custodian | Institutional Trust | Proprietary Custody |
| NerdWallet | Education | Comparison | Third-party Analysis |
Is Coinbase FDIC insured?
FDIC insurance only applies to the cash (USD) balances that Coinbase holds in custodial accounts at U.S. banks on behalf of its customers. This coverage does not extend to cryptocurrency assets.
Is crypto itself FDIC insured?
No. The Federal Deposit Insurance Corporation (FDIC) does not provide insurance for cryptocurrency, digital assets, or any other non-bank products.
What is the difference between FDIC insurance and exchange insurance?
FDIC insurance is a government guarantee for bank deposits. Exchange insurance is typically private commercial insurance that covers specific risks like platform-wide hacks or internal theft, but rarely individual account compromises.
What happens if an exchange is hacked?
Safety depends on the exchange's specific insurance policies and reserves. Reputable exchanges often have "crime insurance" to cover platform-level breaches, but this does not always guarantee individual reimbursement.
What security steps should I enable?
At a minimum, use a strong password and hardware-based two-factor authentication (like a YubiKey or Authenticator app). Avoid SMS-based 2FA which is vulnerable to SIM-swapping.
Where can I find official disclosures?
Look for the "User Agreement" or "Legal" sections on an exchange's website. Search for "FDIC insurance" or "asset protection" within their help centers for the most current terms.