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Coinbase vs. Robinhood: Which Is the Higher Crypto Brokerage? 


A correct comparability of Coinbase and Robinhood will depend on what service you’re searching for. Robinhood follows the playbook of a conventional stockbroker. Via the app, you should buy shares and exchange-traded funds on the inventory market, however it additionally has a restricted menu of cryptocurrencies.

Coinbase, then again, solely gives cryptocurrencies (no shares or ETFs right here), and much more of them. Plus, Coinbase has capabilities that could possibly be thought-about important when shopping for crypto — capabilities Robinhood at present doesn’t have.

Charges

One benefit Robinhood has over Coinbase is the associated fee to buy cryptocurrencies. On Robinhood, it’s free. You should purchase and promote crypto as steadily as you need with no charges in any way (and sample day buying and selling guidelines that exist for shares don’t at present exist for crypto). You’ll nonetheless should pay the unfold (the distinction between the bid and ask worth).

It is price noting that in 2020, a Securities and Trade Fee order discovered that Robinhood supplied “inferior commerce costs,” costing prospects $34.1 million. The SEC investigation was about Robinhood’s advertising and marketing and execution normally and never crypto trades particularly. Robinhood agreed to pay $65 million to settle the fees.

On Coinbase, it’s not so easy. Coinbase has a broadly various payment construction, relying on the quantity you’re shopping for in U.S. {dollars} and the way you’re paying for it. For instance, should you’re shopping for $100 in Bitcoin with a debit card, you’ll pay a payment of three.99%, or $3.99. If you happen to pay with a linked checking account, that payment could be a flat $2.99. Coinbase additionally expenses an expansion of about 0.5% for cryptocurrency gross sales and purchases; that unfold could change relying on market fluctuations. General, charges at Coinbase can get complicated, and admittedly, it feels slightly outdated to pay per commerce when different brokerages have been shifting away from that for years.

Cryptocurrency choice

That is the place cryptocurrency looks like extra of an afterthought for Robinhood, but it’s Coinbase’s bread and butter. On Coinbase, there are dozens of tradeable cryptocurrencies, and much more that may be added to cost watch lists. And, Coinbase provides new tradeable cryptocurrencies pretty usually.

Robinhood, then again, at present lists seven.

Cryptocurrency choice winner: Coinbase.

Crypto capabilities

That is one other class that Coinbase ought to win by default: Robinhood is a stockbroker that dabbles in changing USD into cryptocurrency, whereas Coinbase is a cryptocurrency brokerage and change that additionally gives a hosted pockets, in addition to a private pockets if you would like it.

What does that imply? With Coinbase, you might have the choice to purchase crypto with money, then retailer these cash on Coinbase’s hosted pockets. Or you possibly can ship these cash to your individual Coinbase Pockets, which is totally separate from Coinbase the app. There’s additionally the free Coinbase Professional change, the place you possibly can simply deposit cash out of your Coinbase hosted or private pockets, then commerce them for a a lot decrease payment. (Study extra about crypto wallets.)

In brief, Coinbase is a extremely good onramp for brand spanking new crypto customers, providing customers most of the capabilities cryptocurrencies have been created for within the first place.

With Robinhood, you possibly can’t ship cash out of the app, nor obtain them from an out of doors pockets. Actually, your solely possibility is to transform your USD into crypto, then convert it again to USD if you wish to profit from any rise in worth. Nonetheless, in a YouTube-hosted “fireplace chat,” Robinhood CEO Vlad Tenev stated that they’re working “as quick as attainable” to supply a cryptocurrency pockets that may enable customers to ship and obtain cash.

Crypto capabilities winner: Coinbase.

Technical reliability

The reality is that each corporations have struggled with outages when buying and selling quantity spikes. And this, usually, is when customers are most wanting to have full management of their funds, whether or not it’s a crypto surge or crash.

So till both platform can show it might probably deal with an sudden inflow of exercise, customers must be conscious that this can be a actual risk. Nonetheless, in response to Downdetector, Robinhood has had 49 reported outages in 2021, whereas Coinbase has had 28, giving Coinbase a slight edge by this metric.

Technical reliability winner: Coinbase, based mostly on Downdetector’s knowledge — although even Coinbase’s platform has occasional points.

Ease of use

Each apps are extremely intuitive, quick, clear and straightforward to make use of, and that is smart: Each corporations earn a big portion of their income via transaction quantity. The extra persons are shopping for and promoting, the extra money they make. So it’s of their finest curiosity to create a product that entices shopping for and promoting, even in small quantities and reduces each little bit of friction that exists on the way in which to urgent the “purchase” button.

The tip result’s a product that’s wonderful for inexperienced persons within the sense that the purchase and promote course of is stripped right down to the fundamentals; although some argue that it truly should not be this simple for inexperienced persons to commerce in dangerous, speculative belongings like cryptocurrency.

Coinbase Professional can really feel extra like an intermediate-to-advanced buying and selling platform, however should you’re not able to wade into that, the fundamental Coinbase platform stays extraordinarily simple to make use of, so long as you’re OK paying these charges. With Robinhood, you’ll by no means actually come throughout something that resembles a complicated buying and selling platform.

Ease of use winner: It’s a draw. They’re each extraordinarily well-designed.

So which is healthier, Robinhood or Coinbase?

With regards to cryptocurrencies, Coinbase is the clear winner right here. Whereas its charges may be complicated and excessive, the choice to commerce on Coinbase Professional after getting slightly expertise can deliver these charges down. Robinhood’s free buying and selling is sweet, however it doesn’t make up for the shortage of crypto capabilities (the lack to ship and obtain cash is its most extreme shortcoming) and the shortlist of cryptocurrencies to spend money on.

But when all you care about is speculating on the value of cryptocurrencies — and you don’t have any intention of really utilizing the cash and tokens you purchase — then Robinhood could possibly be a greater match, given the free trades.

NerdWallet ranking 
NerdWallet ranking 
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Charges

0.5% – 4.5%

varies by kind of transaction; different charges could apply



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