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For new crypto traders, Coinbase and Robinhood are two user-friendly, U.S.-based platforms that allow beginners to buy and sell cryptocurrencies. However, Robinhood is a crypto broker that facilitates transactions and lets users purchase stock and altcoins. But, you can’t withdraw crypto funds from your Robinhood account. Instead, users must sell their coins and transfer the balance to their external accounts. In contrast, Coinbase is a cryptocurrency exchange offering a vast selection of currencies and payment methods. Plus, you can withdraw funds to several account types.
Coinbase provides a secure platform perfect for new users who wish to dip their toes into cryptocurrency. Robinhood is also great for beginners but offers limited cryptocurrencies. Instead, Robinhood users want to invest small amounts in both stocks and crypto.
We compared platforms by looking at standard and advanced features. Furthermore, we explored the types of currencies available for users to buy and sell, fee structures, and security options. Check out our full Coinbase review to learn about the features that make it the clear winner in this match-up.
Unlike traditional brokerage firms, cryptocurrency exchanges are not members of the Securities Investor Protection Corp. (SIPC). Therefore, unless user terms specify otherwise, investors with cryptocurrency assets commingled on a custodial cryptocurrency exchange could potentially lose their funds as unsecured creditors.
New and Notable
- On May 17, 2022, Robinhood announced that it is building a brand new non-custodial, web3 wallet. The company will begin inviting waitlist customers to join its Beta program in the late summer and make the product generally available to all Robinhood customers by the end of 2022.
Investing in cryptocurrencies, Decentralized Finance (DeFi), and other Initial Coin Offerings (ICOs) is highly risky and speculative, and the markets can be extremely volatile. Consult with a qualified professional before making any financial decisions. This article is not a recommendation by Investopedia or the writer to invest in cryptocurrencies nor can the accuracy or timeliness of the information be guaranteed.
- Main platform features: User-friendly apps, available in 100 countries, can withdraw crypto to PayPal or a digital wallet and choose from a variety of coins
- Fees: 0.50% per trade, 3.99% for credit card purchases, and 1.49% for Coinbase wallet or bank account purchases
- Number of cryptocurrencies supported: 139
- 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
- Types of transactions supported: Buy, sell, send, receive, and exchange
- Maximum trading amount: Limits vary based on your payment method and region
Ability to earn crypto while you learn
Over 100 cryptocurrencies
Multiple payment and withdrawal options
Limited customer support options
Can’t complete advanced transaction types
- Main platform features: Intuitive applications and supports purchases of crypto, stock, ETF, and options
- Fees: No commissions, but pay an order flow fee that varies by trade
- Number of cryptocurrencies supported: 7
- Security features: 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: Limit orders, buy, and sell
- Maximum trading amount: No limits, but must wait for ACH funds to clear
No commission fees
Stock and crypto trade options
Can’t withdraw crypto funds
Only seven cryptocurrencies
Only available to U.S.-based users
At a Glance
|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||0.50% per trade, 3.99% for credit card purchases, and 1.49% for Coinbase wallet or bank account purchases||No commissions, but pay an order flow fee that varies by trade|
|Number of cryptocurrencies supported||139||7|
|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|
New and Notable
On April 7, 2022, Robinhood announced that it rolled out Crypto Wallets to every eligible person on the WenWallets waitlist of more than two million people. According to the company, all eligible customers who signed up for the waitlist will be able to send and receive any of the cryptocurrencies currently available on Robinhood.
Coinbase vs. Robinhood: Features
Robinhood and Coinbase offer user-friendly applications with just the right amount of features for new investors. Coinbase is a cryptocurrency exchange available to users in over 100 countries, including all 50 states except for Hawaii. In comparison, Robinhood is an online brokerage company for U.S. users in 48 states. But, the differences don’t end there.
With Coinbase, investors can:
- Buy crypto using a credit or debit card
- Learn about cryptocurrency through educational videos and tutorials
- Track trends by watching Coinbase’s online newsfeed
- Set price alerts for crypto to receive a notification in your app or smartphone
- Make crypto to crypto trades on the Coinbase platform
- Withdraw currency to your hot wallet or PayPal account
- Earn cryptocurrency from watching short videos
- Use the standalone Coinbase wallet with or without trading on the exchange
Unlike Coinbase, Robinhood doesn’t offer a digital wallet. You also can’t buy currency using a debit or credit card. However, the largest difference between the platforms is that users can’t move their coins from their accounts until it’s sold for cash. But you can use your coins to purchase exchange-traded funds (ETFs) on Robinhood, and the platform accepts limit orders. Coinbase investors must use the Coinbase Pro account to place limit orders.
Coinbase vs. Robinhood: Supported Currencies
Coinbase supports far more currencies than Robinhood, with 139 crypto options, and they’re always adding more. By comparison, Robinhood only offers seven coins, and you can also buy these on Coinbase, including Dogecoin:
- Bitcoin (BTC)
- Bitcoin Cash (BCH)
- Bitcoin SV (BSV)
- Dogecoin (DOGE)
- Ethereum (ETH)
- Ethereum Classic (ETC)
- Litecoin (LTC)
Investors turn to Robinhood because you can purchase stock, ETF, 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 on USD balances. 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. The Securities Investor Protection Corporation (SIPC) covers your ETF, stock, and cash funds if Robinhood goes under.
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
At first glance, Robinhood’s lack of fees on purchases of crypto or stock is preferable to Coinbase’s hefty fee list. However, 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 figure out which platform is cheaper when buying cryptocurrency.
You’ll pay up to 3.99% per trade on Coinbase, which is one of the highest rates for crypto exchanges. The exact fee depends on your payment method. But, you can use Coinbase Pro at no additional cost and benefit from slightly lower prices.
|Bank account||1.49%||0% fee|
|Wire transfer||$10 deposit, $25 withdrawal||N/A|
|Purchases||0% to 0.50%||N/A|
|Other fees||$0.99 to $2.99 based on the amount||N/A|
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, with the Coinbase app receiving higher ratings.
You’ll find a knowledge base and articles about trading on both sites. Still, Coinbase goes a step further by offering videos and opportunities to earn small amounts of crypto for watching short video snippets.
Both companies offer customer service via email, and responses aren’t always timely, so regardless of which platform you use, you may not get an immediate reply to your question.
Frequently Asked Questions (FAQs)
What Are Coinbase and Robinhood?
Coinbase and Robinhood provide platforms for investors to buy and sell cryptocurrency. Coinbase is a crypto exchange, so you can make crypto to crypto trades and withdraw your coins to PayPal or your Bitcoin wallet. In contrast, Robinhood is a brokerage. Although you can withdraw cash funds, you can’t transfer crypto coins out of your account. However, Robinhood also offers stock, options, and ETF trades, whereas you can only buy or sell crypto on Coinbase.
How Do Coinbase and Robinhood Work?
Both platforms function in similar ways, allowing users to create an account using an easy sign-up process and similar verification measures to ensure security. Robinhood gives your trade to a market maker for execution and charges investors an order flow fee. Once you connect your bank account, you can purchase crypto, but you can’t access your coins or move them to a digital wallet until you sell them for cash.
By comparison, Coinbase is an online cryptocurrency exchange. You have complete control over your coins and can withdraw them to your digital wallet or cold storage at any time.
Can I Transfer Crypto From Coinbase to Robinhood?
You can’t transfer any coins into or out of Robinhood. To use Robinhood, you must purchase crypto using the USD fiat currency via a connected bank account. You can’t move your coins unless you sell them for cash. Coinbase provides a digital wallet for users, so you can transfer supported currencies to your Coinbase wallet and use it to make crypto to crypto trades.
Who Should Use Coinbase or Robinhood?
First-time investors and people who want to invest small amounts find Coinbase and Robinhood extremely user-friendly. Both platforms are excellent for beginners. However, Coinbase fees can take a chunk out of your investment, whereas Robinhood doesn’t charge a commission, so users may pay less per trade.
People who don’t want to withdraw crypto and prefer a single platform to trade crypto, ETF, stock, and options use Robinhood because you can only trade crypto on Coinbase. But if you want to remove your coins or have more cryptocurrency choices, Coinbase’s 51 coins and digital wallet offer a better solution.
How We Evaluated Coinbase vs. Robinhood
We put Coinbase and Robinhood side-by-side and looked at the mobile applications and web-based platforms to see what types of features best 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.