Kraken vs. Coinbase

Kraken balances geographic restrictions with lower fees

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Kraken and Coinbase are two of the most high-profile crypto exchange platforms in the world. Each allows you to buy various currencies using fiat money (U.S. dollars or Euro for example) and is geared for experienced and novice investors. Both high- and low-volume traders enjoy Kraken’s low-fee services and high trading limits. New investors based in the United States appreciate the convenience of Coinbase’s digital wallet and funding options. Unlike Kraken, Coinbase caters to U.S.-based traders, and you can learn more about this platform by reading our in-depth Coinbase review

In this article, we weigh the pros and cons of Kraken and Coinbase and explore their distinctive features, security, fees, ease of use, and more. While both platforms offer appealing elements like mobile apps and 24/7 customer service, each has advantages that will appeal to different investors. Kraken offers flat purchasing fees, which is an excellent benefit for lower-volume traders. Coinbase provides easy funding options like PayPal and debit cards, ideal for U.S. traders.

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.

Kraken


Kraken

 Kraken

  • Main platform features: Low fees, strong security protections, and many currency options
  • Fees: 0% to 0.26% per trade, 3.75% + €0.25 for credit card purchases, and 0.5% plus 0.9% or 1.5% for ACH purchases
  • Number of cryptocurrencies supported: 97
  • Security features: 2FA withdrawal email confirmation, air-gapped cold storage, strict surveillance, precise API key permission control, SSL encryption
  • Types of transactions supported: Buy, sell, send, receive, exchange, futures trading, Cryptowatch, and staking
  • Maximum deposit and withdrawal: $100,000 daily (intermediate level members)
Pros
  • Secure and reliable

  • Low fees

  • High deposit and withdrawal limits

  • Accepts some fiat currency

Cons
  • Many options not available to U.S. users

  • Long verification times

  • Possibly challenging user interface

Coinbase


Coinbase

Coinbase

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  • Main platform features: Easy to use for beginners and can use PayPal to withdraw or sell
  • Fees: 0.50% per trade maker-taker, 3.99% for credit card purchases, and 1.49% for Coinbase USD wallet or bank account purchases
  • Number of cryptocurrencies supported: 120+
  • Security features: Two-step verification, 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 deposit and withdrawal: $25,000 daily via ACH
Pros
  • Excellent user experience

  • Easy funding options

  • Fiat currencies accepted

Cons
  • Not available in all countries

  • Some coins aren’t accepted

  • High fees

At a Glance

Kraken Coinbase
Main platform features Low fees, strong security protections, and more currency options Easy to use for beginners and can use PayPal to withdraw or sell
Fees  0% to 0.26% per trade, 3.75% + €0.25 for credit card purchases, and 1.7% + $0.10 for online banking processing  0.50% per trade, 3.99% for credit card purchases, and 1.49% for Coinbase wallet or bank account purchases
Number of cryptocurrencies supported  97 120+
Security features  2FA withdrawal email confirmation, air-gapped cold storage, strict surveillance, precise API key permission control, SSL encryption Two-step verification, 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, exchange, futures trading, Cryptowatch, and staking  Buy, sell, send, receive, and exchange
Maximum deposit and withdrawal amount  $100,000 $25,000

Kraken vs. Coinbase: Features

Each cryptocurrency exchange caters to industry investors and first-timers alike. Still, Kraken offers features ideal for worldwide investors or U.S. traders who don’t mind giving up convenience for lower fees and additional services. Coinbase’s digital options facilitate processes for U.S. investors. With both Kraken and Coinbase, you’ll get:   

  • Availability: Coinbase offers trading in over 100 countries and Kraken in 176. Both provide varying functions depending on location. For instance, Coinbase isn’t available to Hawaii residents, and Kraken isn’t available in New York or Washington. 
  • Customer service: Global service is available around the clock for both platforms via live chat. Support availability can decrease, and wait times increase, during high-traffic trading times. Both offer help center guides and question-and-answer centers.
  • Margin trading: Kraken offers margin trading with up to five-times leverage, which is average in the industry. Coinbase added the feature in early 2020, offering limited availability at three-times leverage, but promptly disabled it by November 2020.
  • Mobile apps: Each exchange has a highly rated mobile application, offering all the features available on a web browser. However, Kraken’s app isn’t available in five countries and one territory.

Kraken offers Cryptowatch, a trading terminal that analyzes and generates data on over 2,000 cryptocurrency markets. The free service allows traders to monitor price movements and market trends across various platforms and set price alerts. Investors can upgrade this service by paying one credit per alert for more timely notice. 

Coinbase has an added feature, as well. They provide users with a hot wallet they can use to deposit, store, and withdraw currency. You don’t need to be a Coinbase user to use the wallet, making it ideal for traders that transfer between various fiat currencies and cryptocurrencies. Kraken offers clients a digital wallet to store coins between purchases but does not provide a personal wallet service.

Kraken vs. Coinbase: Currencies

Both exchanges support USD, EUR, CAD, AUD, GBP, CHF, and JPY fiat currencies. Coinbase has over 120 cryptocurrencies available for trade, while Kraken has 97. Each provider offers different choices, so users looking for something specific can search both to find what they want. 

For instance, Kraken offers Flow (FLOW) and Icon (ICX). You can trade Filecoin (FIL) and Yearn Finance (YFI) on Coinbase but not Tron (TRX) or Siacoin (SC). 

In addition to Bitcoin, the most popular cryptocurrencies supported by Kraken and Coinbase include:

  • Cardano (ADA)
  • Bitcoin Cash (BCH) 
  • Chainlink (LINK)
  • Ethereum (ETH)
  • Litecoin (LTC)

Kraken vs. Coinbase: Security

Security measures are crucial when considering which exchange to use. Both platforms have solid security track records, and neither has had any significant breaches. Kraken stores 95% of its assets in guarded air-gapped cold storage and has strict surveillance across the entire platform and multiple checkpoints throughout the signup process. 

Coinbase keeps 98% of deposits in offline, geographically distributed cold storage. The Federal Deposit Insurance Corporation (FDIC) insures up to $250,000 of an individual’s USD cash balances, a plus for U.S. traders. 

On the user side, Kraken and Coinbase offer these multi-layered security features:

  • Security keys: When inserted into your computer drive, physical security keys authenticate your login and generate a one-time passcode. You can create several keys and store them in secure locations. 
  • Pretty good privacy (PGP): Each platform guides you through setting up PGP encryption for online communications with the exchange. This precaution will help ensure all cryptocurrency correspondences are kept private and secure. 
  • Two-factor authentication (2FA): Kraken and Coinbase offer 2FA when making withdrawals and transfers. The Coinbase system defaults to 2FA for SMS verification during login.
  • Authenticator apps: Another option for 2FA is authenticator apps. Both companies allow you to use these instead of a text message or email form of 2FA. Popular apps such as Google Authenticator are supported.

Kraken vs. Coinbase: Fees

One significant divide between Kraken and Coinbase comes in the form of transaction fee structures. Kraken's maker-taker fees are amongst the lowest in the industry. Coinbase's maker-taker fees are nearly double, maxing out at 0.50% vs. Kraken's 0.26%.

Kraken calculates transaction fees according to the volume you trade in a 30-day rolling period. The fee schedule includes:

  • Transactions $0 to $50,000 pay a 0.16% maker fee or a 0.26% taker fee
  • Transactions $50,001 to $100,00 pay a 0.14% maker fee or a 0.24% taker fee
  • Transactions $100,001 to $250,000 pay a 0.12% maker fee or a 0.22% taker fee
  • Transactions $250,001 to $500,000 pay a 0.10% maker fee or a 0.20% taker fee
  • Transactions $500,001 to $1,000,000 pay a 0.08% maker fee or a 0.18% taker fee
  • Transactions $1,000,001 to $2,500,000 pay a 0.06% maker fee or a 0.16% taker fee
  • Transactions $2,500,001 to $5,000,000 pay a 0.04% maker fee or a 0.14% taker fee
  • Transactions over $5,000,001 to $10,000,000 pay a 0.02% maker fee and a 0.12% taker fee
  • Transactions over $10,000,000 pay a 0% maker fee and a 0.10% taker fee

Coinbase's maker-taker schedule is considerably more expensive topping out at 0.50%. For example, a $1000 trade would cost $5 dollars with Coinbase. The same trade would cost $2.60 with Kraken, charged at 0.26%.

  Kraken Coinbase
Bank account  $0 to $10 1.49%
Wallet Free 1.49% 
Debit/credit cards 3.75% + €0.25 3.99%
ACH transfer 0.50% + 0.9% to 1.5% Free 
Wire transfer Free to $10 deposit, $4 to $35 withdrawal $10 deposit, $25 withdrawal 
Crypto conversion Volume based 0.50%
Purchases 0% to 0.26% 0% to 0.50% 
Trades 0% to 0.26% based on rolling 30-day volume 0% to 0.50%
Extra fees  None May Apply

Kraken vs. Coinbase: Ease of Use

The user experience for Kraken and Coinbase ranks high. They both provide a reliable experience on desktops and mobile devices. Kraken’s stringent security measures are a bonus for large sum investors, but the added precautions can be trying for users who want to start trading quickly. 

Coinbase offers a quick startup process and keeps trading features and funding options simple, allowing inexperienced investors to trade right away. Coinbase enables new users to start trading with only a phone number verification. With added verification steps users can unlocked higher account levels and limits.

Frequently Asked Questions (FAQs)

What Are Kraken and Coinbase?

Kraken and Coinbase are two of the most trusted cryptocurrency exchanges on the market. Kraken is one of the earliest exchanges, founded in 2011, with its home base in San Francisco, California.

Founded in 2012, Coinbase is also one of the oldest crypto exchanges. It was the first platform to offer an easy-to-use investor model for allowing users to buy and sell Bitcoin and remains a favorite among U.S. investors.

How Do Kraken and Coinbase Work?

Both cryptocurrency exchange platforms allow users to invest in various altcoins. However, setting up, verifying, and adding funds to your Coinbase account is much easier for U.S.-based traders versus Kraken’s more restrictive measures. 

On Coinbase, users create an account, confirm an email address, and set up the two-step authentication process. Next, you need to prove your identity using an approved form of identification. Once that’s complete, you can add your payment method and start trading. 

Although setting up your account on Kraken is similar to the Coinbase process, verification and transferring funds are more complex. Kraken offers Starter, Express, Intermediate, and Pro verification levels and says applying for Intermediate or Pro levels is akin to “opening a bank account.” New fiat deposits require a 72-hour withdrawal hold, and the mobile app isn’t available in the U.S. 

Is Kraken or Coinbase Good for Beginners?

Both exchanges offer learning tools, such as tutorials and how-to guides, which are helpful to new investors. Moreover, novices can start trading on Coinbase or Kraken without much experience. However, with fewer transaction types and a pared-down mobile app, Coinbase rates a little higher on user experience because of their easy signup and funding processes—perfect for beginners who have zero crypto trading knowledge.

Who Should Use Kraken or Coinbase?

Both Kraken and Coinbase are suitable for beginners, offering simple platforms and user-friendly interfaces. Kraken’s low fee structure and robust security features make it a terrific platform for high- or low-volume users who don’t mind the added transaction steps. But, U.S. users have limited funding options and don’t have access to the mobile app, making Kraken a better choice for international users. 

With widely available apps, hot wallet features, and funding options that include PayPal and debit cards, Coinbase users tolerate high fees for a more convenient way to fund their account and make withdrawals. The Coinbase platform is a better choice than Kraken for U.S. traders who value user experience over cost.

How We Evaluated Kraken vs. Coinbase

We compared Kraken and Coinbase side-by-side to uncover the overall cost of trading on the platform, including deposit and withdrawal fees, while considering supported fiat currencies. For both platforms, we looked at multi-layer security options and past incidences of security breaches. We also reviewed transaction types and how options differ for people living in different locations. Furthermore, we explored the quantity and popularity of supported cryptocurrencies while giving points for advanced features, such as offering a digital wallet or market watch tools.

Article Sources

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  1. Federal Deposit Insurance Corporation. “Deposit Insurance FAQs.” Accessed Dec. 22, 2021.