How Coinbase Cleaned Up Its Backlog

Coinbase – at one point this past fall/winter – was adding more than 300,000 new traders per week. Crypto prices were driving monster demand on the platform. That surge in demand coincided with huge price gains in crypto across-the-board. Customers at the time made Coinbase the largest crypto exchange in the United States.

Unfortunately, Coinbase could not keep up with demand. It failed under the pressure. Traders waited for weeks to register in many cases. Even registered traders had problems. They often could not complete transaction orders. Heavy website traffic slowed transaction speeds to a trickle. Reddit boards and Twitter lit up as traders lashed out at Coinbase.
To its credit, Coinbase has righted its ship. The company recently completed a comprehensive 90-day review of what went wrong. Based on those findings, Coinbase has instituted a number of improvements.

The company increased its customer support staff by 150%. The added support, in turn, led to a significant decrease in response time. Most importantly, Coinbase was finally able to reduce its enormous backlog. Backlogs have declined by 95% since its late 2017 peak. Traders are now registered much more quickly and trades are completed near instantaneously.

Coinbase’s improved performance is occurring at a critical time. It faces new competition from other exchanges. Most notably, Robinhood has gained popularity by charging no fees. Robinhood has traditionally offered only stock trading. It recently expanded into cryptocurrency trading by adding Bitcoin and Ethereum to its platform.

Can Coinbase continue its dominance?