GDAX, now known as Coinbase Pro, is a popular cryptocurrency exchange platform that offers a more advanced trading experience compared to its parent company, Coinbase. One of its key advantages is its lower fee structure, making it an attractive option for active traders looking to buy and sell Ethereum and other digital assets.
This guide provides a clear, step-by-step walkthrough of the entire process, from account creation to executing your first trade.
Why Choose GDAX for Buying Ethereum?
While Coinbase is incredibly user-friendly, its fees can be significant for those who trade frequently. These costs can quickly eat into your profits. GDAX addresses this by offering a tiered fee structure that rewards market makers—those who provide liquidity by placing limit orders. In many cases, these orders can be executed with zero fees.
As a global digital asset exchange, GDAX provides access to various trading pairs, which differ depending on your country of residence. It combines robust security features with a powerful trading interface, making it a solid choice for both new and experienced traders.
Step-by-Step Guide to Getting Started on GDAX
Follow these steps to create an account, secure it, and begin trading.
Creating Your GDAX Account
The first step is to establish your presence on the platform.
- Navigate to the GDAX website. Since GDAX is integrated with Coinbase, you can often use your existing Coinbase login credentials.
- If you are new to the ecosystem, select “Create Account”.
- You will be prompted to complete a registration form with your basic information. After filling it out, click “Create an account” to proceed.
Your account is now created, but it requires activation before you can use it.
Activating Your Account via Email
After signing up, you must verify your email address to activate your account.
- Check the inbox of the email address you used to register. You will find a verification message from GDAX.
- Click the verification link within that email.
- You will be redirected to a page displaying the user terms and conditions. Review them and click ‘I Accept’ to continue.
Your account is now activated and ready for the next crucial step: identity verification.
Completing the Identity Verification Process
To comply with financial regulations, GDAX requires all users to verify their identities. This process, known as Know Your Customer (KYC), helps ensure the security of the platform.
- After accepting the terms, you will be asked to provide a valid phone number for two-factor authentication (2FA).
- You will receive a one-time password (OTP) via SMS. Enter this code on the website when prompted.
- Next, you must specify whether you are creating an ‘Individual’ or ‘Institutional’ account. Most users will select the individual account type.
- You will need to provide personal identification details, which typically include uploading a photo of a government-issued ID.
- Finally, you will have the option to link your bank account to facilitate deposits in currencies like USD, GBP, or EUR. You can skip this step initially and fund your account with cryptocurrency later.
Once your identity is confirmed, your account will be fully verified, granting you access to all platform features.
Securing Your Account with Two-Factor Authentication (2FA)
Two-factor authentication is a critical security layer that protects your account beyond just a username and password. It requires two pieces of evidence to confirm your identity: something you know (your password) and something you have (a code from your phone).
- From your account dashboard, navigate to Settings and find the Security tab.
- Locate the option for Two-Factor Authentication and select it.
- You can choose to use an authenticator app like Google Authenticator or Authy. These are generally considered more secure than SMS-based 2FA.
- Using your chosen app, scan the QR code displayed on the GDAX screen. This will link the app to your account.
- The app will then generate a time-sensitive, six-digit code. Enter this code on the GDAX website to complete the setup.
👉 Explore more strategies for securing your digital assets and accounts.
Always store your 2FA backup codes in a safe place. If you lose access to your phone, these codes are the only way to recover your account.
How to Fund Your GDAX Account
Before you can trade, you need to deposit funds. GDAX simplifies transferring assets from your linked Coinbase account.
- On the left-hand side of the GDAX interface, you will find Deposit and Withdraw buttons.
- Click on Deposit to see a list of available funding sources.
- You can choose to transfer fiat currency (USD, EUR, GBP) from your linked bank account or cryptocurrency from your Coinbase wallet.
- Select your preferred currency, enter the amount you wish to transfer, and confirm the transaction. Transfers from Coinbase to GDAX are typically instant and free of charge.
Your funds will now be available in your GDAX account for trading.
Executing Your First Ethereum Trade
With a funded account, you are ready to buy Ethereum. The trading interface provides several tools to help you make informed decisions.
Understanding the Trading Interface
The main trading dashboard consists of several key sections:
- Order Book: This panel displays all current buy (green) and sell (red) orders at various price points. It shows the market's depth and liquidity.
- Price Chart: This interactive chart allows you to analyze the price history of Ethereum. You can adjust the time frame to intervals like 1 minute, 1 hour, or 1 day to spot trends.
- Order Form: This is where you will place your buy or sell orders. You can choose between different order types, including market and limit orders.
Placing a Fee-Free Limit Order
To avoid paying transaction fees, you should aim to be a "maker" by placing limit orders. A maker adds liquidity to the market by setting an order that is not immediately filled by an existing order.
- To place a limit buy order: Select the "Limit" order type. Enter the price at which you want to buy Ethereum (e.g., $2,000) and the amount you wish to purchase. By setting a price below the current market value, your order will sit in the order book until a seller is willing to meet your price. When they do, your order will execute with a 0% maker fee.
- To place a limit sell order: The process is similar. Select "Limit," enter your desired sell price and quantity. By setting a price above the current market value, you become a maker, and the order will execute with no fee once a buyer accepts your price.
This method requires patience but can lead to significant savings on trading fees over time. Once your order is filled, congratulations—you have successfully bought Ethereum on GDAX!
Frequently Asked Questions
Q: What is the difference between Coinbase and GDAX (Coinbase Pro)?
A: Coinbase is designed for simplicity, acting as a straightforward brokerage for buying crypto. GDAX (Coinbase Pro) is its advanced trading platform, offering more charting tools, order types, and a lower fee structure, particularly for users who place limit orders.
Q: Are my funds on GDAX insured?
A: GDAX holds the vast majority of customers’ digital assets in offline cold storage. These assets are covered by crime insurance. U.S. customers may also have cash balances held in USD FDIC-insured bank accounts, up to applicable limits.
Q: I already have a Coinbase account. Do I need to create a new one for GDAX?
A: No. Your Coinbase and GDAX (Coinbase Pro) accounts are linked. You can use your existing Coinbase login credentials to access the GDAX trading platform instantly.
Q: What are the trading fees on GDAX?
A: Fees are based on a 30-day trading volume and whether you are a maker (adding liquidity) or a taker (removing liquidity). Historically, maker fees have been 0%, making it very attractive for patient traders, while taker fees are a small percentage of the trade value.
Q: How long do bank transfers take to clear on GDAX?
A: Deposits via ACH bank transfer can take 3-5 business days to clear before the funds are available for trading or withdrawal. However, transferring cryptocurrency from your Coinbase wallet to GDAX is instantaneous.
Q: Can I use GDAX from any country?
A: GDAX availability and supported trading pairs vary by region. It is best to check the official website for the most current list of supported countries and available services for your location.