Coinbase vs Robinhood: which should you choose?

Introduction

New cryptocurrency traders can purchase and sell cryptocurrencies on two user-friendly U.S.based platforms: Coinbase vs Robinhood. However, Robinhood is a cryptocurrency broker that makes trades possible and enables customers to buy stocks and alternative currencies. 

However, you cannot withdraw cryptocurrency funds from your Robinhood account. Users must exchange their coins for cash and transfer the proceeds to their external accounts. Coinbase, in contrast, is a cryptocurrency exchange that accepts a wide range of currencies and payment options. Additionally, you can transfer money to several account types.

A safe platform is offered by Coinbase, making it ideal for new customers looking to get started with cryptocurrencies. Although it only provides a few cryptocurrencies, Robinhood is still excellent for novices. Instead, Robinhood users choose to make modest stock and cryptocurrency investments.

Features of Coinbase vs Robinhood

For novice investors, Robinhood and Coinbase both offer programs that are simple to use and have the ideal number of functionality. Users can access Coinbase, a cryptocurrency exchange, in more than 100 countries, including all 50 U.S. states except Hawaii.

In contrast, Robinhood is a 48-state-only online brokerage service for American customers.

However, there are still more differences.

Coinbase allows investors to:

• Purchase cryptocurrency with a credit or debit card.
• Through tutorials and instructive films, learn about cryptocurrencies.
• Watch the online newsfeed for Coinbase to keep up with trends.
• Create cryptocurrency price alerts to get notifications on your app or phone.
• Execute cryptocurrency exchanges on the Coinbase platform.
• Withdraw money to your PayPal or HotWallet account.
• Watching brief videos can earn you money.
• Whether trading on the exchange is required, use the solo Coinbase wallet.

Robinhood doesn’t provide a digital wallet, in contrast to Coinbase. Debit or credit cards are also not accepted for money purchases. The most significant distinction between the platforms is that users cannot move their coins until they have been exchanged for cash. However, Robinhood allows you to buy exchange-traded funds (ETFs) with your coins and supports limit orders. Limit orders must be placed using the Coinbase Pro account for Coinbase investors.

Security of Coinbase vs Robinhood

Similar security measures, like two-factor (2F) authentication and Federal Deposit Insurance Corporation (FDIC) insurance on USD holdings, are available on Coinbase and Robinhood. Customers who utilize Robinhood must “opt into Cash Management” to receive FDIC insurance. But Coinbase has a slight advantage. Coinbase maintains an insurance policy to cover potential breaches of coins in hot storage and retains 98% of its currencies in air-gapped cold storage.

Coins are also kept in cold storage, though Robinhood doesn’t go into detail. If Robinhood fails, your ETFs, stocks, and cash funds are covered by the Securities Investor Protection Corporation (SIPC).

Your currencies are safeguarded for Coinbase digital wallet customers by a 12-word encryption recovery phase. If you see any strange devices, Robinhood offers device control so you can disconnect them from your account.

Fees of Coinbase vs Robinhood

In terms of how they handle fees, Coinbase and Robinhood are essentially opposed. While Robinhood keeps things simple and charges no commissions, Coinbase is too convoluted and earns its money from the difference between the buy and sell prices. In general, Robinhood is the superior option.

There are simple trade and complicated trade options on Coinbase. Depending on the choice you select, there are various fees. Always use that trading tool to avoid paying fees because advanced trades are significantly less expensive.

The amount you pay for advanced transactions on Coinbase is based on your trading volume and has a tiered fee structure. The maker-taker model is also utilized. You are charged a taker fee if your trade is filled right away. If not, a maker fee is assessed. The Coinbase charge schedule for complex transactions is as follows:

30-DAY TRADING VOLUME IN U.S.DOLLARS	TAKER FEE	MAKER FEE
Up to $10,000	0.60%	0.40%
$10,000 to $50,000	0.40%	0.25%
$50,000 to $100,000	0.25%	0.15%
$100,000 to $1,000,000	0.20%	0.10%
$1,000,000 to $20,000,000	0.18%	0.08%
$20,000,000 to $100,000,000	0.15%	0.05%
$100,000,000 to $300,000,000	0.10%	0.02%
$300,000,000 to $500,000,000	0.08%	0.00%
Over $500,000,000	0.05%	0.00%

Ironically, the pricing structure for simple deals is more intricate. Depending on the order quantity, you are charged either a flat cost or a variable percentage fee, but there is no documented fee structure. You pay a fee of approximately 1.5% on straightforward trades of $205 or more. Flat fees for smaller trade amounts are as follows:

• Up to $10: $0.99
• Up to $25: $1.49
• Up to $50: $1.99

Up to $205: $2.99So which platform is generally more affordable? Due to Robinhood’s lack of costs, we cannot compare them. Looking at how much cryptocurrency you’d get for your money with each one is the most accurate option.

I looked at several orders of various coins on Coinbase and Robinhood to find out. Using its sophisticated trading interface, Coinbase wasn’t that far behind Robinhood, which regularly supplied the most cryptocurrency.

Availability of crypto in Coinbase vs Robinhood

There is no comparison in terms of crypto choices. With well over 150 cryptocurrencies, Coinbase has one of the broadest selections of all the major cryptocurrency apps. Its selection is substantially smaller than Robinhood’s, which has offered more than ten cryptocurrencies.

Either platform allows you to invest in a select few well-known companies. Both Coinbase and Robinhood provide several industry leaders, such as:

• Bitcoin (BTC)
• Ethereum (ETH)
• Solana (SOL)
• Dogecoin (DOGE)

However, you should choose Coinbase if having access to a wide range of cryptocurrencies is vital to you. Robinhood lacks several well-known cryptocurrencies, including Cardano (ADA) and Polkadot (DOT). Additionally, it is considerably better for tiny tokens and frequently adds new cryptocurrencies.

It’s important to note that Robinhood has more components than only cryptocurrency trading. It is also one of the more well-known platforms for trading options and equities. This makes it a wise decision for investors who wish to purchase equities and cryptocurrencies in the exact location.

Conclusion

The best option will depend on your bitcoin investment goals because Coinbase and Robinhood are two different services.

In so far as it offers a greater variety of cryptocurrencies, functionality, and educational materials, Coinbase is unquestionably the superior cryptocurrency exchange. Coinbase is one of the most excellent options for going deep into cryptocurrencies.

A stockbroker that also offers bitcoin trading is called Robinhood. Although it has fewer crypto offers, it makes up for this by providing additional investing options. Robinhood could be a good fit for your needs if you’re searching for a one-stop investment platform where you can add some of the more prominent cryptocurrencies to your portfolio.