Coinbase vs. Robinhood: Which Should You Choose? - The first knowledge sharing application in Vietnam

Crypto Exchange Platforms
Coinbase
Robinhood

Main platform features
User-friendly apps, available in more than 100 countries, can withdraw crypto to PayPal or a digital wallet and choose from a variety of coins
Intuitive applications and supports purchases of crypto, stock, ETF, and options

Fees
Maker-taker exchange fees as high as 0.60% and other fees for various transactions are calculated at the time of transaction
No commissions, but pay an order flow fee that varies by trade

Number of cryptocurrencies supported
250+
18

Security features
2-step verification, cold storage, biometric fingerprint logins, insurance in the event Coinbase is breached, FDIC-insured USD balances, AES-256 encryption for digital wallets
2-step verification, FDIC-insured USD balances, cold storage, SIPC coverage for ETF, stock, and cash funds, insurance against crypto platform breaches

Types of transactions supported
Buy, sell, send, receive, and exchange
Limit orders, buy, and sell

Maximum trading amount
Limits vary based on your payment method and region
No limits, but must wait for ACH funds to clear

Coinbase vs. Robinhood: Features

Robinhood and Coinbase offer user-friendly applications with features for new investors. Coinbase is a cryptocurrency exchange available to users in over 100 countries, including all 50 states except Hawaii. Robinhood is an online brokerage company for U.S. users in 48 states.

Coinbase users can transfer funds via the Automated Clearing House Network (ACH), debit or credit card, wire transfer, or PayPal. Additional features include:

Staking: Coinbase users can earn up to 6% APR for staking.
Coinbase Pro: Advanced users can get a free upgrade to the Coinbase Pro platform that offers extra trading options and charting.
Coinbase Learning Rewards: Earn free coins while watching educational videos

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Web and hot wallets: Coinbase users can store their currencies in the Coinbase web wallet or select the Coinbase wallet, a standalone digital wallet outside the exchange.

In September 2022, Robinhood launched a beta version of its self-custody, web3 wallet. Robinhood Wallet helps you control your crypto on the Polygon and Ethereum networks where you hold and maintain the private key to your assets. Robinhood users cannot buy currency using a debit or credit card or move coins from their accounts until it’s sold for cash. Coins can be used to purchase exchange-traded funds (ETFs) on Robinhood, and the platform accepts limit orders. Additional Robinhood features include:

Stock Trading: Access stocks and ETFs without fees.
Financial News: Through Robinhood Snacks, users can subscribe to daily financial news and information.
Learning Portal: Educational materials that include information on crypto and options trading.

Coinbase vs. Robinhood: Supported Currencies

Coinbase supports over 250 currencies. By comparison, Robinhood only offers 18 coins, and you can also buy these on Coinbase:

Aave (AAVE)
Avalanche (AVAX)
Bitcoin (BTC)
Bitcoin Cash (BCH)
Cardano (ADA)
Chainlink (LINK)
Compound (COMP)
Dogecoin (DOGE)
Ethereum (ETH)
Ethereum Classic (ETC)
Litecoin (LTC)
Polygon (MATIC)
Shiba Inu (SHIB)
Solana (SOL)
Stellar Lumens (XLM)
Tezos (XTZ)
Uniswap (UNI)
USD Coin (USDC)

Investors turn to Robinhood to purchase stock, ETFs, and options. Robinhood accepts only USD fiat currency, while Coinbase supports USD, EUR, and GBP. Both platforms let you buy coin fractions.

Coinbase vs. Robinhood: Security

You’ll find similar security features on Coinbase and Robinhood, such as two-factor (2F) authentication and Federal Deposit Insurance Corporation (FDIC) insurance. For FDIC insurance through Robinhood, users must “opt into Cash Management.” However, Coinbase has a slight edge. Coinbase keeps 98% of currencies in air-gapped cold storage and holds an insurance policy to cover potential breaches of coins in hot storage.

Robinhood also stores coins in cold storage but doesn’t provide specifics. Securities Investor Protection Corporation (SIPC) covers your ETF, stock, and cash if Robinhood defaults. For Coinbase digital wallet users, an encrypted 12-word recovery phase protects your currencies. Robinhood offers device management, so you can disconnect them from your account if you see any unknown devices.

Coinbase vs. Robinhood: Fees

Commission-free trading doesn’t mean zero costs. Robinhood earns money as a brokerage by collecting a percentage of the trade when it’s executed by market makers, meaning you may pay a higher market rate for crypto. Unlike Coinbase, Robinhood doesn’t disclose charges for order flow, so it’s hard for investors to determine which platform is cheaper when buying cryptocurrency.

Coinbase fees are calculated when you place your order and are determined by your location, the payment method, the size of the order, and market conditions such as volatility and liquidity.

Coinbase vs. Robinhood: Ease of Use

Although Coinbase and Robinhood differ in many ways, both are incredibly user-friendly and built for first-time investors. It’s slightly quicker to sign-up and trade on Coinbase because it accepts debit or credit card payments, whereas Robinhood only allows ACH transactions. Both applications provide mobile apps for Android and iOS devices.

You’ll find a knowledge base and articles about trading on both sites. However, Coinbase offers opportunities to earn small amounts of crypto for watching short video snippets. Customer service is available by email on both sites.

Final Verdict

Coinbase and Robinhood offer user-friendly platforms with a secure space for storing cryptocurrency. Coinbase provides a substantially higher amount of cryptocurrencies, while Robinhood mainly focuses on the beginner trader and investor by offering crypto plus stocks and ETF trading. After evaluating the ease of buying and selling, fee structures, standard and advanced features, and security options for cryptocurrency, Coinbase is our choice.

Methodology

We put Coinbase and Robinhood side-by-side and looked at the mobile applications and web-based platforms to see what features support new users. Since both platforms are geared towards beginners, we considered ease of use and attributes that make trading easy and help users learn more about investing. Furthermore, we reviewed supported transaction types, currencies, and fees. Lastly, we examined unique features and security measures provided by each platform.