Coinbase vs Robinhood

When Bitcoin and other cryptocurrencies took the mainstream by storm in 2017, the number of available options for getting started in cryptocurrency trading exploded. Since then, Coinbase and Robinhood have become two of the most well-known, trusted brands in the cryptocurrency trading space. It can be difficult to figure out which of these two options will by right for you, so let’s take a closer look at what each platform has to offer its users.

Coinbase Overview

The Coinbase brand is synonymous with the greater cryptocurrency space at large. It was the first major cryptocurrency exchange that made it simple and easy for its users to purchase their first Bitcoin, and the company has been riding their focus on ease-of-use all the way through today.

Coinbase homepage

Coinbase Pros and Cons

The Benefits PRO's
  • Coinbase was the first platform to make it easy to buy Bitcoin all the way back in 2012
  • Due to its longevity and approval from regulators, Coinbase is one of the more liquid exchanges on the market
  • Coinbase takes a more measured approach than some other exchanges in terms of deciding which coins to add to the platforms
  • This platform can be used by both newcomers and more advanced traders
The Downside CON's
  • If you aren’t using Coinbase Pro, then you’re going to pay higher fees
  • Coinbase is notorious for its inability to deal with spikes in web traffic and trading volume whenever there is a lot of activity in the market
Coinbase Logo

Coinbase

  • User-friendly
  • Great customer service
  • Low services fees
  • Diverse and consistently updated choice of coins

Robinhood Overview

Robinhood got into the cryptocurrency game much later than Coinbase. Although Robinhood launched in 2013, they originally focused on traditional stocks rather than the cryptocurrency market. Having said that, Robinhood’s focus on simplicity with their original trading app has served them well in the cryptocurrency market.

Robinhood Homepage

Robinhood Pros and Cons

The Benefits PRO's
  • In addition to crypto assets, users also have the ability to trade traditional stocks
  • Robinhood is on par with the likes of Coinbase when it comes to having an easy-to-use interface
  • Low fees (not completely free)
  • There is no minimum amount that can be deposited
The Downside CON's
  • You cannot withdraw your cryptocurrency holdings from the exchange
  • The altcoin selection on this platform is limited

Coinbase vs. Robinhood at a Glance

Information Coinbase Robinhood
Headquarters: San Francisco, USA Menlo Park, USA
Company type: Broker Exchange/easy buy-sell options Broker Exchanges that also deals in traditional stocks
Fees: Coinbase: Medium-High (1.49-3.99%) Coinbase Pro: Low (0% to 0.5%) Low: 0.1% via spread
Security: High Medium
Beginner Friendly: Yes Yes
Verification required: Yes Yes
Available cryptocurrencies: Bitcoin, Ethereum, Ripple (28 Total) Bitcoin, Ethereum (7 Total)
Proprietary token: Yes No
On-site wallet: Yes No
Buy/Deposit Methods: Debit Card, Bank Transfer, Cryptocurrency ACH Bank Transfer
Sell/Withdraw Methods: Bank Transfer, PayPal, Cryptocurrency ACH Bank Transfer
Year established: 2012 2013
Fiat trading: Yes Yes
Gold: No Yes

Beginner Friendliness

Both Coinbase and Robinhood are targeted to cryptocurrency beginners; however, a key difference is that Robinhood also lets their users invest in traditional stocks and ETFs. While Robinhood can be seen as the perfect platform for someone who investing in anything for the first time, Coinbase would be a better option for someone who wants to dig a bit deeper into the world of cryptocurrency.

The average person who just wants to gain exposure to the price of Bitcoin or another popular cryptocurrency will probably be better off with Robinhood, as they’ll be able to manage all of their investments in one location. Any beginner who wants to keep their focus on the cryptocurrency market will be better off with Coinbase, as there are more cryptocurrencies available for trade and users also have the ability to withdraw their coins off of the platform.

Trust & Security

Security is a complicated area of comparison between Coinbase and Robinhood. On the one hand, Coinbase claims they have never been hacked, although it was recently revealed they may have faced a serious security issue in its early days. On the other hand, Coinbase also allows users to withdraw cryptocurrencies to their personal wallets, which means a hacker is able to more easily steal money from an account and actually get away with it.

Robinhood has faced a number of different security issues over the years, but these issues are mitigated by the fact that the platform operates in the traditional financial system, where transactions can be more easily reversed.

If you are getting into the world of cryptocurrencies for the first time, you’ll be better off with Robinhood from a security perspective, as the app will operate like your traditional investment accounts. More advanced users should opt for Coinbase, as it will give you more control over your funds and allow you to store your assets without any third-party risk (off of the exchange).

Fees

Robinhood claims that it offers zero-fee crypto trading, but the reality is there is still a cost to trading on this platform. While there are no direct fees charged, you will not be able to buy and sell Bitcoin and other cryptocurrencies at the same price. The buy price for Bitcoin and other cryptocurrencies on Robinhood is going to be roughly 0.1% higher than the generally-accepted rate found on most other exchanges, so there is still an added cost here to consider.

Having said that, this is still much lower than the 1.5% rate charged by Coinbase on their base platform. Even Coinbase Pro will charge more than Robinhood. For most traders, Robinhood will be able to provide lower fees than Coinbase.

Sign-Up Process

Robinhood’s sign-up process is a bit easier than Coinbase’s, as long as you’re going through the full verification process on both platforms. While Coinbase let’s you buy cryptocurrency with a phone number being the only serious form of additional verification, this tier of the platform is limited to $9,000 worth of activity. If you want to expand your limits, you’ll need to provide a variety of documentation, including a photo of yourself holding your own government-issued ID.

On the other hand, with Robinhood, you only need to share your social security number to verify your identity.

Available Cryptocurrencies

Coinbase has four times the cryptocurrencies available to trade than Robinhood. That said, Bitcoin SV is available on Robinhood but not on Coinbase. If you know you’re only interested in Bitcoin, Robinhood might be the better option for now, but if you’re interested in dabbling in a wide variety of crypto assets, then Coinbase will be your best bet.

Stand Out Features

The fact that Robinhood allows users to do all of their trading (both crypto and stocks) in one app is a pretty big differentiator that is not commonly found in the cryptocurrency exchange market. Although the crypto asset selection is kind of limited, this ability to keep everything in a single app should be attractive to those who already have investments in the traditional market and do not have millions of dollars to throw around.

For Coinbase, the key stand out feature is its ability to onboard new users to the cryptocurrency ecosystem. Yes, Robinhood is easy for beginners too, but with Coinbase, you have the ability to take true control of your cryptocurrency assets. In terms of actually learning how this technology works while speculating on the prices of various cryptocurrencies, Coinbase is a better option than Robinhood.

Conclusion

There’s a lot of information to take in when comparing Coinbase vs Robinhood, and the reality is that there is no perfect exchange that can magically meet all of the desires of every possible user out there in the world today. If you’re someone who already has a Robinhood account and is thinking about trading cryptocurrencies for the first time, you’re probably better off staying with Robinhood for now. Although if you want to withdraw your cryptocurrency assets into your personal cryptocurrency wallet, Robinhood is not the best option for you. If you’re someone who wants to trade cryptocurrencies, learn more about cryptocurrency and various other coins in the market, have the ability to withdraw your crypto assets to your personal wallet at any time, then Coinbase is a better fit for you.

About the Author

CryptoVantage Logo

CryptoVantage Staff