If you plan to deposit cash into your Coinbase account to purchase cryptocurrency and quickly pay a merchant, service provider, or seller, you may encounter unexpected delays. Even long-established Coinbase accounts can experience temporary holds and additional security reviews before cryptocurrency can be transferred off the platform.
If your payment is time-sensitive, these delays could cause you to miss deadlines, lose promotional pricing, or delay a transaction entirely.
Our Experience
We recently wanted to pay a well-known and trusted online merchant in Bitcoin (BTC) to receive discounted pricing on a service. Since we don't regularly send cryptocurrency, we decided to use our four-year-old Coinbase account, expecting the process to be straightforward.
Instead, we encountered multiple delays.
1. ACH Deposit Accepted Immediately
We initiated a $6,000 ACH bank deposit into our Coinbase account.
The funds were credited immediately, allowing us to purchase Bitcoin right away. At this point, everything appeared to be working as expected.
2. Bitcoin Transfer Blocked by a Bank Hold
After purchasing Bitcoin, we attempted to send it to the merchant's Bitcoin wallet.
Instead of completing the transfer, Coinbase displayed a message indicating the funds were subject to a bank hold.
After contacting Coinbase Support, we were informed that ACH deposits are commonly subject to a holding period before cryptocurrency purchased with those funds can be transferred off the platform. According to Coinbase, these holds can typically last 3 to 10 days, although the exact duration varies by account and transaction.
This meant we owned the Bitcoin but were unable to send it when we needed it.
Before this transfer goes through, we need to ask a few quick questions to help protect your account. Our systems flagged this transaction for review, which is a normal part of keeping your funds safe. This should only take a minute. What are you planning to use this money for?
Sometimes scammers will call pretending to be from Coinbase or crypto support and tell you to move your money for safety. Has anyone from Coinbase or a similar company reached out to you about this transfer?
Scammers sometimes give you a fake address that looks like it goes to a legitimate business but actually goes to them instead. How did you get the address you're sending this to?
Sometimes people get coached through crypto purchases while they're on a call or video chat with someone who's actually trying to steal their money. Are you on a phone or video call with anyone as you do this?
People sometimes think they're buying from a real business but the payment address actually goes to a scammer instead. What's the name of the business you're buying from?
Thank you for your patience while we completed our security check. Your transfer has been cleared and can now proceed. If you have any doubts about this transaction, remember that you can cancel at any time before completing it.
Final check before sending If you have any doubts, you should still cancel it to be safe. Accept the terms before sending: l accept full responsibility and understand the funds can't be recovered if it's a scam. I confirm that no one from Coinbase has asked me to transfer funds.
3. Additional Identity Verification After the Hold Expired
Once the bank hold expired, we expected the transfer to proceed normally.
Instead, Coinbase required us to complete another identity verification process before allowing the transaction. This included:
- Confirming our identity
- Answering security questions
- Completing additional verification steps
The entire process took approximately 30 minutes.
4. Transaction Placed Under Internal Review
After successfully completing the identity verification process, we attempted to send the Bitcoin once again.
Rather than completing the transaction, Coinbase informed us that the transfer had been flagged for an internal security review.
According to the notification we received, this review may take up to 72 hours before a decision is made.
At this point, our payment was delayed yet again.
What We Learned
If you plan to use Coinbase to make a time-sensitive cryptocurrency payment, it's important to understand that several independent security measures may delay your transaction, including:
- ACH deposit holds before cryptocurrency can leave Coinbase
- Additional identity verification requests
- Manual internal security reviews before transfers are approved
Even if your account has been open for years and has a positive history, these checks may still occur.
Planning Ahead
If you're paying a merchant that requires cryptocurrency by a specific deadline, consider preparing well in advance. Depositing funds several days before you need them may help account for potential bank holds, identity verification requests, and additional security reviews.
While these security measures are designed to help protect customer accounts and reduce fraud, they can be frustrating when you're trying to complete an urgent payment.
Final Thoughts
Our experience demonstrates that purchasing Bitcoin on Coinbase does not necessarily mean you'll be able to transfer it immediately. Between ACH deposit holds, identity verification requirements, and potential internal security reviews, the process can take significantly longer than many users expect.
If your payment is time-sensitive, it's worth factoring these potential delays into your plans before relying on Coinbase for a cryptocurrency transaction.