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Coinbase vs Robinhood: A Complete Comparison

Buying Bitcoin for the first time can be a bit of a hassle there are so many platofrms to choose from and the newbie trader might feel overwhelmed. In this post we will dive into two of the more popular and noob friendly platforms: Coinbase vs Robinhood. 

By the Way, Before We get Started

Downloading a Bitcoin wallet you can trust can be overwhelming for a variety of different reasons, which include:

  • There are a lot of confusing terms you don’t know about.
  • You aren’t sure of what to look for. 
  • Many Bitcoin wallets promise to provide the same benefits. 

Two of the most popular bitcoins wallets are Atomic Wallet and BRDRobinhood. Both products offer different features for their users. If you’re going to start buying Bitcoin, both products are highly recommended. However, if you want to use the best Bitcoin wallet for you, here’s an in-depth comparison of how Coinbase and Robinhood stack up against each other. 

Robinhood Overview

Robinhood has made buying stocks and crypto easy
Robinhood has become well known as one of the default stock exchanges for retail buyers

Robinhood’s entry into the cryptocurrency market was much later than Coinbase’s back in 2013. The platform originally focused on traditional stocks rather than cryptocurrency. With that said, Robinhood strives for simplicity and the trading app has become popular in the cryptocurrency app marketplace for its user-friendliness. 

Coinbase Overview

Coinbase was one of the earliest cryptocurrency platforms available. 

Most experienced traders still use Coinbase, as it’s one of the most safest bitcoin platforms out there. 

In fact, Coinbase is arguably the safer option of the two. 

Deposits & Withdrawals

Robinhood has a very nice user interface with all of the important information readily available.
Stonks go up

If you only want to deal with USD, Robinhood is an ideal platform. However, if you’re planning on adding Bitcoin into your account, it is may not be the best option.

Robinhood fee schedule
Robinhood has been a pioneer in reducing the fees in regards to trading

For digital assets and ACH-related transactions, deposit and withdrawal fees are free. This is also true if you want to buy Bitcoin and move it to another trading platform or a privately controlled wallet. 

Trading Costs

Buying bitcoin with credit cards on coinbase and robinhood
Buying Bitcoin with Credit has never been easier

For most traders, it’s all about getting the most affordable all-in-price. Here is a side-by-side comparison of example trading costs for both platforms (Coinbase on the right, Robinhood on the left).

Comparison of Coinbase and Robinhood fees/Bitcoin asks
Robinhood (left) vs Coinbase (right)

At first, it looks like Coinbase offers more affordable trading costs since the price listed in the screenshot is almost $9 (0.12%) than Robinhood ($7389.20 vs. $7398.15).

However, there are fees that must be considered. On Coinbase, there is a tier of fees depending on how much you want to trade. Most small traders will have to pay 0.50% ($37 in this case). In this case, Coinbase is clearly more expensive since trading on Robinhood is free. This makes Robinhood the better option for a vast majority of users that value inexpensive trading costs. 

Transparency

The Coinbase platform for trading crypto is a bit more advanced than Robinhood
Coinbase shows all of the current bids and asks which make up the spread of the asset

Coinbase is a platform that matches orders between sellers and buyers directly. Users can also place orders in the app’s order book that’s displayed in real-time. A fee schedule for the order book is typically displayed on their website, but it can be a bit difficult to calculate your net trading price. 

Robinhood makes trading much simpler by displaying a trading price without any fee. However, Robinhood is a broker that sells order flow to other firms. As a result, the difference between buy and sell prices are nearly $20. Since there is no fee, there is a high mark-up.

Coinbase has a simple interface where trade prices and other orders are not displayed. Overall, Coinbase showcases more trading information and is more transparent in terms of the true cost to trade. 

Trading Tools

Coinbase Pro has a lot of bells and whistles and may seem intimidating to noobs
There is also Coinbase Pro which should be considered as a near-professional type trading tool

Robinhood is significantly limited in its trading tools. The platform has buy and sell buttons, and it’s easy to change from a limit to a market order. Robinhood also displays an unlabeled and fixed price chart.

That’s all there is for their interface.

Coinbase offers a “stop” order type and plenty of exchange market information in real time that can be used in the configurable chart tool, trade history, and order book.

Both platforms do come up short compared to thinkorswim, Interactive Brokers, and E*Trade and cannot be counted on for advanced trading tools that active traders expect.

Additional Cryptocurrencies

Coinbase has a very friendly interface on both mobile and web
Coinbase has a very friendly interface on both mobile and web

If you want to explore trading with other cryptocurrencies, Coinbase is the ultimate choice.

Robinhood only offers seven cryptocurrencies beyond Bitcoin, while coinbase offers 17 additional cryptocurrencies.

As of October 2020, Coinbase has many more currencies to choose from compared to Robinhood
As of October 2020, Coinbase has many more currencies to choose from compared to Robinhood

Coinbase also explicitly prices cryptocurrencies in well-known stablecoins as well as a variety of other cryptocurrencies as well.

Therefore, Coinbase offers more flexibility who want to move forward from fiat currency, such as USD.

Coinbase Pros & Cons

Coinbase trading page
Coinbase trading page

Here are the pros and cons of using Coinbase.

Pros:

  • Coinbase was the very first platform to make it simple to buy bitcoin since 2012. 
  • Due to recommendations from regulators and longevity, Coinbase is one of the best liquid exchanges evaluation. 
  • Coinbase uses a measured approach when determining which coins to add to other platforms. 
  • This platform can be used by both beginner and advanced traders.
  • The platform offers 17 additional cryptocurrencies. 
  • Coinbase offers a more transparent platform with more trading tools.

Cons:

  • Coinbase’s trading costs are very expensive. 
  • Coinbase has an inability to endure large and sudden spikes in trading volume and web traffic when a lot of activity is taking place in the market.

Robinhood Pros & Cons

You can trade on Robinhood on a variety of platforms
Robinhood has both an app and a responsive desktop site

Here are the pros and cons of using Robinhood.

Pros:

  • Users are able to trade both traditional stocks and crypto-assets. 
  • Robinhood, like Coinbase, has an easy-to-use interface.
  • The platform boasts much lower fees than Coinbase.
  • There isn’t a minimum deposit amount.

Cons:

  • Users can’t withdraw any cryptocurrency funds from the exchange.
  • Coinbase offers a limited amount of trading tools and altcoins. 
  • Robinhood isn’t a versatile platform for more advanced users. 

The Final Verdict:

Bitcoins are bought with money
Bitcoin although often pictured as such is actually completely digital

There’s a lot of things to consider when comparing Coinbase vs Robinhood. 

The reality is that there isn’t any perfect platform that can meet all of the needs of every possible user in the world. If you’re someone who already has a Robinhood account and you’re interested in trading cryptocurrencies for the first time, then it’s probably best to stay with the platform for now. However, if you want to transfer your crypto-assets to your personal cryptocurrency wallet, then Robinhood isn’t the best platform for you. On the other hand, if you’re someone that wants to trade cryptocurrencies, learn more about it and other currencies, and withdraw your assets to your personal wallet, Coinbase is the best choice. On the other hand, if going through an exchange is not for you, you can always buy your crypto with Venmo.

What do you think?

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