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Robinhood versus Coinbase

Robinhood offers commission-free equity and ETF trading, IPOs, and cryptocurrencies. Coinbase became one of the most trusted US-based cryptocurrency exchanges and a market leader in its category by volume as of March 2021. Both continue to attract clients, with millennial and GenZ traders their primary market with a preference for mobile trading, where Robinhood and Coinbase present their in-house developed apps.

Beginner traders get educational content at Robinhood and Coinbase, but the latter pays a small number of cryptocurrencies after completing each lesson. Both struggle to fix their customer support, but Robinhood also has a controversial operating history and receives payment for order flow. Robinhood pioneered commission-free trading in the US, while Coinbase brought cryptocurrency trading to the retail sector.

We have conducted an in-depth review of Robinhood and Coinbase to determine which one presents the better overall choice and which traders will benefit the most at either broker.

Headquarters
United StatesUnited States
Tier 1 Regulator(s)?
Owned by Public Company?
Year Established
20122013
Execution Type(s)
Market MakerMarket Maker
Minimum Deposit
None$0
Trading Platform(s)
Proprietary platform, Web-basedProprietary platform
Minimum Raw Spreads
N/ANot applicable
Minimum Standard Spreads
N/ANot applicable
Minimum Commission for Forex
N/ANot applicable
Islamic Account
Signals
US Persons Accepted?
Managed Accounts
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Features and Platforms

MT4
MT5
cTrader
Proprietary Platform
Automated Trading
DOM?
Guaranteed Stop Loss
Scalping
Hedging
One-Click Trading
OCO Orders
Interest on Margin
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Noteworthy:

Both offer a branded debit card, ensuring clients have swift access to their funds. A monthly subscription-based account upgrade exists at Robinhood, costing $5 monthly, including a $1,000 margin allowance. Neither supports algorithmic trading.

Available Markets

Cryptocurrencies
N/A
Commodities
Crude Oil
Gold
Metals
Equity Indices
Stocks (non-CFDs)
ETFs
Options
N/A
Futures
Synthetics
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Coinbase remains a pure cryptocurrency exchange but excels in this sector, presenting the broadest asset selection in the US. Robinhood is primarily an equity broker with access to select cryptocurrencies, gold, options, and ETFs. It also offers IPO trading and fractional share dealing from as little as $1, ideal for diversifying smaller portfolios.

Typical Spreads and Fees

Average Trading Cost Bitcoin
0.05% to 0.60%N/A
Minimum Raw Spreads
N/ANot applicable
Minimum Standard Spreads
N/ANot applicable
Minimum Commission for Forex
N/ANot applicable
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Robinhood maintains higher trading costs versus many competitors but offers leveraged traders one of the lowest margin rates at 2.50%. Pricing transparency remains an issue at this broker, which supplements income by selling order flow. Coinbase Standard costs range between $0.99 and $2.99 with a fixed margin rate of 8.00%.

Security and Trust

Country of the Regulator
N/AUnited Kingdom, United States
Regulatory License Number
N/A165998, 8-69188, 823590
Regulatory Tier
N/A1, 1
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Robinhood is a Financial Industry Regulatory Authority (FINRA) member. The Securities Investor Protection Corporation (SIPC) offers client protection up to $500,000 per net equity or $250,000 for cash claims. Additional Robinhood membership consists of The New York Stock Exchange (NYSE), the NASDAQ, and the CBOE EDGX Exchange (CBOE EDGX).

Coinbase remains unregulated but duly registered as a Money Service Business with the US Financial Crimes Enforcement Network (FinCEN). It has all the necessary licenses to carry out its business. Coinbase Global Inc., the exchange operator, is a NASDAQ listed company with SEC oversight, which does not carry over to the cryptocurrency exchange operations.

Robinhood vs Coinbase – Verdict

Coinbase

Pros
Cons
Excellent choice of cryptocurrency assets, and US market leader by trading volume Limited deposit and withdrawal options
Coinbase debit card for swift financial transactionsInadequate customer support
Educational content allows beginner traders to earn crypto assets
Publicly listed company

Robinhood

Pros
Cons
Fractional share dealing from $1.00 and access to IPO tradingLimited deposit and withdrawal options
Debit card for swift financial transactionsQuestionable business practices and lack of overall transparency
Beginner traders get a wealth of educational content in written form
Optimized mobile app

Coinbase offers US-based cryptocurrency investors an excellent choice. Clients get a broad-based asset selection, a user-friendly exchange platform, and a hassle-free method to acquire cryptocurrencies. Robinhood caters to equity investors who accept higher trading costs. It also features IPOs, ETFs, and a convenient trading platform. Both maintain a secure trading environment.

You might also be interested in reviewing the below broker comparisons:

FAQs

Which one is better: Coinbase or Robinhood?

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Coinbase is better for cryptocurrencies, but trading costs are lower at Robinhood, primarily catering to equity traders. Coinbase presents a notably broader choice of cryptocurrencies.

Is Robinhood the same as Coinbase?

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Robinhood is primarily an equity broker, while Coinbase is a cryptocurrency exchange.

Why is there a price difference between Coinbase and Robinhood?

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The costs depend on the liquidity providers and internal mark-ups, where Robinhood creates an edge but only features a few cryptocurrencies.

Are you actually buying Bitcoin on Robinhood?

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Robinhood supports physical Bitcoin purchases with cold storage as a security feature. It also maintains insurance against theft and cybersecurity breaches.