Few fundamental differences between this and FIAT.

When a company that holds your fiat does this, they're likely using that money on their investments, or at least gaining interest on it.

With crypto, there is no inherent benefit for the company to hold your coins for you. They get ZERO volume from it, no fees gained, etc... and there is no interest gained.. It's literally just sitting there, for the benefit of no one.

Anyways, didn't they say they wouldn't support BTG until they made some critical changes first?

https://support.coinbase.com/customer/portal/articles/2892196-bitcoin-gold-faq

At this time, Coinbase cannot support Bitcoin Gold because its developers have not made the code available to the public for review. This is a major security risk.

We will continue to monitor the development of Bitcoin Gold, and if its network proves to be both secure and valuable, Coinbase may decide to support it at a later date.

Coinbase/GDAX will not sell or keep Bitcoin Gold associated with customer Bitcoin for itself. Any Bitcoin Gold will remain securely stored on Coinbase. If Coinbase were to enable support for Bitcoin Gold at a future date, customers would be able to withdraw Bitcoin Gold associated with their Coinbase/GDAX Bitcoin balances at the time of the Bitcoin Gold fork.