As the demand for crypto trading has increased over the years, many traders have started looking for an exchange to suit their particular trading needs.
Now, there are many exchanges available on the market, each having different trading and depositing fees, user experiences, security features, and trading functionalities. Depending on your trading experience and preferences, you will have to evaluate an exchange’s features and how they can help you achieve your investment goals.
Today we will review and compare Robinhood and Coinbase to help you determine which platform is best for you.
Robinhood vs. Coinbase – Main Differences
Coinbase and Robinhood are both high-profile crypto exchanges that have been active in the industry for many years. Coinbase started its activity in 2012, and Robinhood in 2013.
Both platforms were developed to enable beginner traders to buy and sell cryptocurrency easily, but they have different features when it comes to the trading aspect.
Coinbase is an exchange where you can buy coins using fiat, trade cryptos with other cryptos, and withdraw coins to external wallets. On the other hand, Robinhood is a brokerage where you can buy cryptos, stocks, options, and ETFs using fiat currency and have a limited number of coins transferable directly to non-custodial wallets.
But the number and variety of options are not the only differentiators. So, let’s list the characteristics of the two platforms below:
|Types of transactions supported||Limit orders, buy, and sell||Buy, sell, send, receive, and exchange|
|Stock, ETF, And Options Trading||Yes||No|
|Supported countries||Only in the US||100+ countries|
|Fees:||Zero fees for trades, but you pay the order flow fee||0.60% per trade, 3.99% for credit card purchases,|
|Security||2FA verification, cold storage, biometric logins, FDIC-insured USD balances, AES-256 encryption for crypto wallets||2FA verification, cold storage, FDIC-insured USD balances, SIPC insurance for ETF, stock, and cash funds|
Robinhood vs. Coinbase – Fees & Transactions
Robinhood Trading Fees
Robinhood does not apply any fees for the processes of buying and selling cryptocurrencies, which makes it very appealing to investors. Instead, Robinhood charges commissions on payment for order flows, which means that the trading fees are combined in a spread markup(difference between the bid and ask price) on the trade. This means you pay more when you are the buyer and get less when you are selling.
The Trading Activity fees are between $0.000130 per share (equity sells) and $0.00218 per contract (options sells). This fee is rounded up to the nearest penny and no greater than $6.49.
Robinhood Funding Fees
There are no fees when depositing fiat in your Robinhood account. Still, withdrawals made via Instant Bank Transfers incur a fee of 1.5% (min $.02). Here, you can view the complete fee list, which includes their commissions for trading securities, ETFs, and options.
Coinbase Trading Fees
Coinbase is a bit pricier as far as crypto exchanges go. And unfortunately, the platform does not have a very clear pricing structure. The fees vary depending on the purchased amount, with its basic tier (Coinbase) and pro tier (Coinbase Pro) charging different fees.
According to a Coinbase update made on their official blog on September 20, 2022, they implemented a new fee structure to “account for changes in global crypto trading volumes and asset prices.”
On smaller trades, you’re charged either a flat fee or a variable percentage fee based on your order’s size.
- $10 or less: $0.99
- More than $10 and up to $25: $1.49
- More than $25 and up to $50: $1.99
- More than $50 and up to $200: $2.99
This means that for a trade over $200 you will be paying a flat fee of around 1.5 percent. And this is added to the spread mark-up that’s already in-built into the trade’s price.
Coinbase Funding Fees
You can deposit fiat currency in your Coinbase wallet through bank transfer, debit or credit card, ACH transfer, wire transfer, and even PayPal. Below are the fees incurred for each supported funding option:
|Payment Method||Coinbase Fee|
|Wire Transfer||$10 incoming, $25 outgoing|
|Crypto ConversionPayPal Deposit||2% 2.5%|
Robinhood vs. Coinbase – Main Features
Coinbase Main Features
- Crypto trading and withdrawals: On Coinbase, you can trade a crypto with another crypto, having hundreds of pairs to choose from. You can also withdraw your crypto and deposit it in an external wallet.
- Newsfeed: Coinbase features a built-in newsfeed that allows you to stay up to date with the latest changes and events from the crypto market.
- Price alerts: You can set price alerts for the cryptos you want to monitor and be notified on your smartphone when your coins increase or decrease in price by a large percentage.
- Educational materials: Coinbase’s platform and mobile app feature educational videos where you can learn about cryptocurrency projects and even earn small amounts of that currency.
- Fiat options: Coinbase supports many fiat payment methods, including debit cards, bank transfers, and PayPal, making it very convenient for first-time traders.
- Wallet options: The exchange supports both custodial and non-custodial wallets, allowing you to keep cryptos on the platform or withdraw them to an individual wallet for hodling.
- Reward program: You can earn extra cryptocurrency through the Coinbase Rewards program, which always adds new offerings.
- Staking feature: Coinbase also has a staking feature, where you can earn interest by just holding the coins on the exchange for a certain period of time.
- NFTs: Coinbase has an NFT marketplace where people can buy and sell NFTs as well as create their own.
Robinhood Main Features
- Limit orders: Robinhood lets you set limit orders on their crypto, which enables you to buy or sell cryptos at the price you specify.
- Cash management: Robinhood features a cash management account that generates an interest of 1.50% annual percentage yield (APY). Account owners also receive a debit card issued by Sutton Bank, which enables you to withdraw free of charge from more than 75,000 ATMs, and gives you access to $1.5 million of FDIC insurance through its cash sweep program banks.
- Robinhood Gold features: If you upgrade your account to Robinhood Gold, you are able to access several advanced features, such as margin trading, Bigger Instant Deposits sums, and 3% interest on your uninvested brokerage cash with cash sweep to an affiliated bank account. This optional upgrade carries a monthly fee of $5.
- Securities investment: The platform lets you trade with conventional assets, including stocks, exchange-traded funds (ETFs), and options.
- Wallet features: Robinhood only provides a custodial crypto wallet that has no private keys, which may concern some crypto owners. If you want to transfer crypto to your own non-custodial wallet, you have to transfer your coins out of Robinhood first and pay the network fees.
You can also send your coins to your Robinhood account, but this feature is limited only to a few cryptos:
- Bitcoin (BTC)
- Bitcoin cash (BCH)
- Bitcoin SV (BSV)
- Dogecoin (DOGE)
- Ethereum (ETH)
- Ethereum Classic (ETC)
- Litecoin (LTC)
Robinhood vs. Coinbase – Supported Currencies
In terms of coin offering, Coinbase supports considerably more cryptos than Robinhood. Robinhood supports a selection of 17 cryptos, including Bitcoin (BTC), Bitcoin Cash (BCH), Bitcoin SV (BSV), Cardano (ADA), Dogecoin (DOGE), Ethereum (ETH) and Ethereum Classic (ETC)
Coinbase, on the other hand, supports over 150 cryptos, adding new coins at a relatively regular rate. Just this August, the exchange added 12 more cryptos, and users can verify their blog to find out when new coins will be listed.
In addition to Ethereum and all EVM-compatible coins, the app supports major coins such as Bitcoin, Dogecoin, Litecoin, Stellar Lumens, and Ripple.
Robinhood vs. Coinbase – Trading Experience
Both platforms have been designed intuitively and with ease of use in mind to reduce any friction in the buying or selling process.
The interfaces let you buy and sell cryptos easily, even as a first-time trader, as they feature the basic functions you need for making a seamless trade.
How to Buy Bitcoin with Coinbase
Step 1: Create a Coinbase Account
Go to the Coinbase site or download the Coinbase app to sign up on the platform. You will be required to provide a valid government-issued ID and a document as proof of address. The verification process time will depend on the region you live in.
Step 2: Add Funds to Your Account
After you have created your account, select one of the available payment methods (bank account, debit card, or wire.)
Step 3: Start a Buy or Sell Trade
From your Coinbase account, navigate to the Buy & Sell section. For mobile users, tap the ( + ) Buy located on the Home tab.
From the Buy panel, search for BTC and click on Bitcoin. From the mobile app, use the search bar to find your coin. Tap on the coin to be redirected to the purchase screen.
Step 4: Make the Buy Trade
Enter the amount you want to spend in fiat currency, and you will be able to see how much that sum means in Bitcoin.
Click on the “Preview buy” to view the details of your purchase and verify if everything is correct before clicking on the “Buy now” button.
After the order has been done, you’ll be redirected to the confirmation page. Wait a few minutes for your BTC to be sent to your Coinbase BTC wallet.
How to Buy Bitcoin with Robinhood
Step 1: Create an Account
First, you’ll have to create a Robinhood account. For this, you will need to download the Robinhood mobile app or use your browser to sign in. Please note that you will have to have a valid Social Security Number, email address, and proof of address documentation to register.
Step 2: Fund Your Account
After your account has been verified, you can select your preferred payment method to deposit fiat currency.
Step 3: Make a Bitcoin Trade
Find your coin by using the search bar. Access the cryptocurrency’s detail page and click on “Buy.” After this, type in how much fiat you want to use to buy your Bitcoin. Click on the “Review” button to revisit the details of your trade.
To submit your order, swipe up.
Robinhood vs. Coinbase – Security
Coinbase Security Features
- Two-factor authentication: (2FA) via SMS or the Google Authenticator that generates a time-sensitive passcode for your account.
- Built-in wallet: a password-protected wallet with an encrypted 12-word recovery phrase.
- Cold storage: 98% of all crypto funds are kept in “cold storage” – a wallet with no internet access.
- FDIC insurance (up to $250K): FDIC insurance on USD (U.S. dollar) deposits up to $250K. The insurance does not cover cryptocurrency funds.
Robinhood Security Features
- Two-factor authentication: 2FA via Google Authenticator. SMS account recovery is disabled to prevent phone hacking.
- Device management: Robinhood allows you to review all the devices that have accessed your account, and remove any that you don’t recognize.
- Cold storage: Robinhood keeps cryptocurrency offline as well, though it does not mention the amount.
- FDIC insurance (up to $250K): FDIC insurance applied to USD deposits, but it also does not cover cryptocurrency funds.
Robinhood vs. Coinbase – Support
Robinhood lets customers request for a support representative to call them back at any hour of the day or night, with the app alerting them they will receive the call within 30 minutes of requesting it.
Coinbase customers can reach support via 24/7 live phone, email, or live chat.
Online, the consensus is that both customer support systems are lacking, with many complaints focusing on lost funds, frozen accounts, slow response times, and so on.
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It should be noted that Coinbase is supported in over 100 countries from all over the world, while Robinhood is only available to citizens of the US. Thus, the latter platform is not suitable for international traders.
Robinhood is best for those that want to buy and hold popular cryptocurrencies without paying any additional trading fees.
Coinbase, while it has higher fees, is more fitted for coin-to-coin trading as it has more features and exotic altcoins.
Both platforms are geared towards beginner traders, so it all comes down to your trading style and what kind of portfolio you want to build.