By James Davis
Choosing the right trading platform is key when buying your first cryptocurrency. This article compares two of the most popular US-based trading platforms: Robinhood and Coinbase, to help you decide which one suits your needs.
History of Coinbase
Launched in 2011, Coinbase is among the oldest crypto exchanges. Its founder Brian Armstrong was an engineer at Airbnb. As of July 2023, the trading platform has over 50 million users worldwide, allowing them to trade multiple digital assets, including the most popular, Bitcoin and Ethereum.
Coinbase was registered as a public company in April 2021. Its stock, COIN, is listed on popular stock exchange Nasdaq.
History of Robinhood
Robinhood began operations in 2013. its co-founders, Baiju Bhatt and Vladimir Tenev, previously developed trading platforms for various companies.
Robinhood started as a stock-focused broker, but in early 2018, the firm announced it would begin supporting crypto trading. The platform has about 40 million users.
Like Coinbase, Robinhood is a publicly-traded company on Nasdaq, trading under the HOOD ticker.
Comparison Between Robinhood and Coinbase
Robinhood vs. Coinbase: Supported Assets
Coinbase is a pure crypto exchange supporting crypto-to-crypto and fiat-to-crypto trading. Its lists over 150 cryptocurrencies.
On the other hand, Robinhood supports several tradable instruments, including cryptocurrencies, stocks, exchange-traded funds, bonds, and Mutual Funds. However, the trading platform supports less than ten cryptocurrencies.
Robinhood vs. Coinbase: Crypto Custody
Being a centralized exchange, Conbase holds cryptocurrencies on behalf of its users. However, these users can transfer their digital assets to external wallets whenever they please. The transfers only take a few minutes.
As for Robinhood, the trading platform holds the users’ cryptocurrencies, but in order to withdraw their digital assets, they must submit a withdrawal request, which can take up to two business days to be processed.
Robinhood vs. Coinbase: Security
The two trading platforms offer Federal Deposit Insurance Corporate for US dollar funds and implement two-factor authentication.
In terms of storage, 98% of Coinbase’s funds are stored in cold wallets. Moreover, the company has an insurance policy that covers possible exploits on hot wallets. On the other hand, Robinhood says it keeps all cryptocurrencies in hardware wallets.
Robinhood vs. Coinbase: Deposit Methods
To deposit funds in both platforms, you must verify your account first. Coinbase allows verified users to deposit fiat through SEPA transfers, which can take up to three business days to complete. If you want to buy crypto instantly, you can use your debit card.
The process of Depositing funds for buying crypto on Robinhood is easy. You only need to link your bank account with your trading account. The downside is that you can only spend a maximum of $1,000 on crypto.
Robinhood vs. Coinbase: Trading Fees
You will pay a 4% fee when buying crypto using a debit card on Coinbase. The platform also charges taker and maker fees of 0.4% and 0.6%, respectively.
Conversely, Robinhood does not charge any trading fee on crypto.
Robinhood vs. Coinbase: Customer Support
Coinbase now offers support via phone calls in the countries it has a presence. Moreover, users can visit the “Coinbase Support Center” on the trading platform to find the answers to their questions. You can also raise a support ticket in case you need personal assistance.
Robinhood also has a support center. In addition, you can use its live chat feature on the platform to get quick responses from the company’s customer care team.
Robinhood Vs. Coinbase: Crypto Staking Rewards
You can earn passively by staking your proof-of-stake cryptocurrencies like Tezos and Ethereum on Coinbase. However, this service has come under SEC’s scrutiny in recent months.
At the moment, Robinhood does not offer crypto staking. However, the company said in 2022 that it was considering giving users access to this service in the coming months.
Conclusion
Although Coinbase and Robinhood are both reputable trading platforms, we consider Coinbase the better option for buying crypto assets. That’s because it lists several digital currencies and does not have too many restrictions.