Coinbase offers clients an “all cryptocurrency all the time” trading platform that offers one of the largest selections of cryptocurrencies in one place. The exchange’s Pro platform has a distinctly competitive pricing, but unfortunately, the basic service tier offers expensive deals and keeps the complex fee structure hidden. Coinbase allows clients to take possession of their cryptocurrency holdings and allows them to earn staking rewards (income) from them, both of which are uncommon among the few brokerages that even support cryptocurrency trading. However, Coinbase customer support remains poor, and it is unfortunate that it is very popular on cryptocurrency exchanges.
Traders looking to take a crypto sideline for stocks or options may want to take a look at Interactive Brokers, which just introduced low-cost trading in a handful of cryptocurrencies. Other names to consider include Kraken and eToro, both of which are crypto-focused brokers. Binance.US is another solid choice and offers very low commissions as well.
- Crypto Traders Only
- Active Traders
- Save and Rewards
Coinbase at a glance
|Minimum balance:||0 dollars|
|tradable securities:||125 cryptocurrency|
|Trade cost:||base layer: Rates range from 1.49 to 9.9 percent, plus a profit margin of 0.5 percent
Professional class: Slider scale starts at 0.5 percent and decreases based on size
|Customer service:||Email, emergency support phone, 24/7 chat.|
|Account Fee:||$10 per month inactivity fee after 12 months of no login. There are no deposit or withdrawal fees.|
|Mobile Application:||Coinbase mobile app is available on Apple App Store and Google Play Store|
Pros: Where Coinbase stands out
Coinbase Pro commissions
Coinbase stands out from most packages in its commission structure, but only if you use the exchange’s Pro service tier. (For more information on the basic service category, see below.) At the Professional level, you will pay a fee of a maximum of 0.5 percent for a monthly trading volume of less than $10,000. But you may be able to reduce these fees further by using volume based exchange pricing.
The pricing structure of the Pro is expanded, so the fees go down as you trade. What you pay depends on your total dollar trading volume for the previous 30 days. Coinbase also uses the Trader Maker pricing model, so if you are adding liquidity to the market (the maker) or taking liquidity (the taker), you will likely be charged a different fee.
For example, if you traded less than $10,000 in the previous 30 days, Makers and Traders each pay 0.5 percent. Trade between $10,000 and $50,000, both of which pay 0.35 percent. Above this level, the fees begin to vary. Monthly trading volume between $50,000 and $100,000 gives the trader a 0.25 percent fee and the makers 0.15 percent. The fees eventually drop further, but you will have to trade massive amounts of cryptocurrency to make any difference.
The all-in fee compares well with eToro, where spreads fees start at 0.74 percent and go up to several percent, although it is more than Interactive Brokers, which charges 0.12 – 0.18 percent, depending on the monthly trading volume (with $1.75 each) minimum trade). It is worth noting that fees at Binance.US start at 0.10 percent and then decrease from there.
Choosing a cryptocurrency
Coinbase has an enviable selection of cryptocurrencies that you can trade – 125 at last count – and that should be wide enough for all but the most die-hard cryptocurrency traders. You will get access to the most popular cryptocurrencies, including Bitcoin, Ethereum, Cardano, Solana, XRP, and dozens of others to come. So you are likely to find what you are looking for here.
This is in sharp contrast to other brokers or financial apps that advertise cryptocurrency trading but offer only a handful of the most widely followed currencies. For example, Robinhood only offers trading in seven cryptocurrencies – which is still better than many brokers – while Interactive Brokers has just launched trading in four cryptocurrencies.
If you are looking for something else besides cryptocurrency on Coinbase, you are out of luck. If you want to trade stocks, options, and ETFs while only having access to the most popular cryptocurrencies, Robinhood, Webull, or Interactive Brokers might be good alternatives.
Unlike brokers who focus more on trading, Coinbase allows you to keep your crypto assets on your own. The exchange offers its own crypto wallet, or you can bring your own. In either case, you can choose the most suitable solution for your needs. This is very unusual in the world of trading, where most traditional brokers do not allow you to hold your own assets.
Coinbase also allows customers who hold some cryptocurrency with them to participate in the rewards. Betting is like earning interest in a bank account but with a different set of risks. Staking generates income from your holdings as it is used to validate transactions in a specific cryptocurrency, and Coinbase that rewards you is shared with you. Coinbase gets a commission on any income you get from staking.
Customers can earn staking rewards on a few cryptocurrencies at the moment, including Ethereum and Tezos. The exchange handles the technical side of things and additional coins – or parts of it – are added to your account on a set schedule.
Cons: Where Coinbase could be improved
It can’t be stated any other way: If you are using the Coinbase platform, you will be hard-pressed to find a fee schedule before you actually trade. In fact, Coinbase has gone out of its way to hide its fee schedule, deliberately hiding its public – and confusing – list of fees.
Now, just to be clear, you will be able to see your trading commission, but only before you are ready to start your trading. In this era of highly transparent pricing, it is a serious blow to the company if you cannot provide a list of trading fees so that you can make a sound judgment.
Why is Coinbase doing this? It’s not obvious, but it’s possible that the broker’s exorbitant fee for its base level has a lot to do with it. This is also supported by the broker’s good disclosure of the fees for their Pro platform – their costs are competitive with and in some cases even outperforming competitors.
Trading commissions at the basic level
It is advisable to avoid Coinbase’s basic service tier if you can and go straight to the professional tier, due to its lower pricing. How high are commissions at a basic level? Well, honestly it’s hard to say (see above). But the latest data suggests that you’ll pay a lot more on a percentage basis.
Let’s break down two of the most popular fees in the latest published timeline of fees and see what traders will pay if they buy $1,000 in Bitcoin:
- 1.49 percent fee, if paying from a bank account or Coinbase dollar wallet
- 0.5% profit margin
If you use the Coinbase entry tier, you will get at least 1.99 percent of the costs. And they go up from there, because the company uses a sliding scale. Want $10 in Bitcoin? You’re in for a $0.99 fee — or 9.9 percent — plus a 0.5 percent profit margin — versus the full 10.4 percent. This is not one aspect of the transaction either. You will get hit back and forth.
The effective percentage drops until your purchases are $200, then the broker shifts a fee based on your payment method, starting at 1.49 percent (as above) and rising to 3.99 percent if you use a debit card. And you will still pay the price difference on top of that.
This is a bewildering combination of fees and earnings via payment methods, and it can be difficult to navigate. So it’s best to skip the entry category and go straight to the competitive Pro pricing.
Coinbase also falls woefully short and eerily short when it comes to customer support. Just try to get someone on the phone to help you. Coinbase only supports locking your account over the phone. You promised to have real phone support by the end of 2021, but maybe 2022 will be the year.
If you have other unusual issues (funding issues, for example), you’ll have to submit a support ticket and wait for Coinbase to get back to you. Or you can run the site’s chatbot and see if that solves your problem. Neither of them is particularly satisfying these days.
Coinbase makes a solid choice if you’re looking for a place to trade cryptocurrency and you’re doing it with some decent volume – and don’t mind the serious lack of customer support:
- Its wide range of popular cryptocurrencies means that you will likely find what you want to trade, but you will only be able to trade cryptocurrencies here.
- Clients have the ability to earn staking rewards and can take custody of their property themselves.
- Commissions on the Pro platform are competitive, but clients who trade small dollar volumes on the entry level platform should seriously consider looking elsewhere.
Robinhood offers a good alternative if you are looking to trade only some of the most popular cryptocurrencies, especially if you are looking to cut costs. Webul is another alternative, although its selection is narrower than Robinhood’s. Another broker offering trading in stocks, options and cryptocurrency is Tastyworks, a new player with an attractive commission structure.
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