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Robinhood vs Coinbase: The Biggest Differences
Robinhood and Coinbase are popular online investment platforms that offer a wide range of investment options to active traders. Both investment apps allow you to trade various cryptocurrencies such as Bitcoin, Ethereum, Dogecoin, and more.
But both platforms have distinct differences that must be taken into account before signing up. Robinhood is ideal for traders looking for exposure to multiple asset types (provides stocks, ETFs, options, cryptocurrencies, and ADRs). On the other hand, Coinbase is a better choice for traders looking for cryptocurrency-specific trading features.
Robinhood and Coinbase account features and fees also differ. Keep reading to see how the investment platforms compare.
Robinhood Pros and Cons
Offer commission-free trading on stocks, ETFs, options and cryptocurrencies. In addition to its lack of minimum account size requirements, Robinhood also offers Robinhood Gold (for margin trading and more advanced users), cash management privileges, fractional stocks, and American Depositary Receipts (ADRs).
Compared to Coinbase, Robinhood is a better choice for traders who want to consolidate traditional investments (such as stocks, ETFs, options) and cryptocurrencies under the same umbrella. Although Robinhood has a much smaller crypto pool than Coinbase, it Do Offers a variety of investment options.
But unlike Coinbase, Robinhood does not offer institutional (for companies) crypto exchange services, nor does it allow you to transfer crypto assets into or out of your account (for example, you will not be able to make currency withdrawals or send any crypto assets to other wallets or users ).
You’ll need at least $1 to trade partial stocks, and unlike many online brokers, Robinhood charges $0 for options contracts (most brokerages charge $0.65 per options contract).
Then there’s Robinhood Gold. Robinhood Gold account has a monthly fee of $5, but allows you to trade on margin at a 2.5% annual rate. The account also gives you access to professional market data, larger instant deposits (can range from $5,000 to $50,000), and Morningstar professional research reports on nearly 1,700 stocks.
For cash management services, Robinhood gives you a customizable debit card, a 0.30% interest rate on uninvested cash, and access to 75,000 ATMs.
Robinhood mobile app is available on iOS and Android devices.
Read the full Personal Finance Insider review of Robinhood here »
Coinbase Pros and Cons
Founded in 2012, Coinbase is a global cryptocurrency exchange serving both individual and institutional investors. The platform provides a wide range of services, including crypto exchange services, digital storage, crypto rewards, storage, and more.
Retailers can choose between two different accounts – Coinbase Standard or Coinbase Pro – when exchanging cryptocurrency. The Standard account only offers things like trading, crypto rewards, interest rewards, digital storage, and mobile access. With a Coinbase Pro account, you can take advantage of more advanced features such as trading APIs, order books, and charting tools. Coinbase Pro also offers FDIC insurance of up to $250,000.
Unlike Robinhood (which only allows you to trade a few crypto assets), Coinbase gives you access to more than 80 cryptocurrencies. Additionally, if you are big on crypto rewards or staking (staking is a process that allows you to earn interest by holding certain cryptocurrencies over a specific period of time), then Coinbase might be perfect for you.
The crypto exchange’s Coinbase Earn feature pays you to learn about different crypto assets (see more here). Additionally, with staking, you can earn up to 5.0% APY for owning various assets. Coinbase requires at least $1 to bet, and allows you to participate in the following crypto assets: ethereum, algorand, cosmos, tezos, dai and usd coin.
Institutional traders can take advantage of the Coinbase Prime trading platform, offline storage of crypto assets, trading services, fundraising services for new crypto companies, and more.
Coinbase is available on iOS and Android mobile devices.
Read the full Personal Finance Insider review of Coinbase here »
Robinhood vs Coinbase: Which is Right for You?
Robinhood and Coinbase both offer a variety of investment options. But the biggest differences to watch out for are fees, investment options, and crypto features.
While Robinhood offers a small selection of commission-free cryptocurrencies, it is not the best choice for traders who want access to a wide range of crypto assets. In addition, Robinhood does not provide services to institutional traders (as opposed to individuals) as Coinbase does, nor does it allow you to transfer crypto assets.
On the other hand, Coinbase has higher fees, but it allows you to exchange a much larger range of cryptocurrencies. It also offers crypto rewards as an educational incentive to learn about different assets, and you can earn coins to earn regular interest.
Overall, Robinhood is the best choice for those who are looking for the best of both worlds with trading cryptocurrencies, stocks, ETFs, and options. However, Coinbase is the best option for traders who are interested in cryptocurrency.