> To me Coinbase feels more like bank. Once I deposit money I no longer worry about the physical security of that money. Clearly that isn't the case given it's not FDIC insured, but the fact that it's a multi-billion dollar publicly-traded corporation instills some confidence.

And that is the danger. It feels like a bank, and lots of other people also feel it is like a bank, so you figure you are safe.

But it is not a bank. It does not offer the regulator protection of a bank. Feelings don't change that. A good UI does not change that. Only regulation change that.