If anyone today looks into the world of cryptocurrencies, they would immediately associate a feeling of being overwhelmed, not surprising because to process the amount of information when it comes to the numerous cryptocurrencies out there can be quite a challenge. The same applies when it comes to exchanges that exist in the crypto space.
However, the chances are that you most definitely would have heard of the two leading exchanges in the space, Binance, and Coinbase. So how do the two stack up against each other? Is Coinbase, with its simple user interface, the better platform? Or is Binance, the platform offering advanced features, the better option? We’re going to make a side-by-side comparison of the two platforms, exploring different features of each and seeing how they both stack up against each other.
A Brief Summary
- Coinbase is famous for its ease of use and accessibility and is one of the most popular exchanges in the world.
- Binance is the most popular exchange in the world, with an average daily volume of 2 billion.
- Coinbase offers users two types of accounts, Coinbase and Coinbase Pro. The basic account allows users to trade with fiat currency, while the pro account allows advanced trading.
- Coinbase is best for those investors who want to buy and hold, while Binance is for those users who are interested in advanced trading.
Binance Vs. Coinbase: Which One Is Better For You?
This depends on what you prefer; Both exchanges offer a host of features for their users. Binance, although established recently, offers its users more than 500 cryptocurrencies. It also allows its users to trade without having to undergo extensive KYC checking. In addition, Binance gives its users access to cryptocurrencies like Bitcoin, Binance Coin, Ethereum, and also other Stablecoins like Tether.
Coinbase has the backing of several venture capitalists and operates with complete transparency and compliance with KYC regulations, and has a presence in over 100 countries. It supports fewer cryptocurrencies than Binance, with only major cryptocurrencies supported. However, new additions comprise ERC-20 tokens such as BAT, ZRX, etc., and several other high-cap cryptos. Coinbase also enables users to use fiat currencies as a mode of payment.
|Binance Pros||Binance Cons|
|Offers over 500 cryptocurrencies for trading to its users||Limited use in the U.S, with most consumers in the U.S unable to use the exchange.|
|Cheap and easy to use||A complex user interface, which can sometimes confuse even experienced users.|
|Vast selection of transactions||Lack of a digital wallet.|
|Coinbase Pros||Coinbase Cons|
|Coinbase is extremely user friendly.||Transaction and other fees are a little on the higher side.|
|Complies with all regulations in the U.S and has significant venture capitalist backing||Has limited options for advanced traders which can be a hindrance when it comes to trading.|
|Offers multiple methods of purchasing cryptocurrency for its users.||Offers fewer types of transactions compared to Binance and other platforms.|
Binance And Coinbase in direct Comparison
|Features||Over 500 cryptocurrencies, low transaction and trading fees, detailed charting options||Easy to use platform, Offers users basic transactions, availability of a digital wallet.|
|Cryptos||500 cryptocurrencies featured on the global trading platform, 52 available for users in the U.S||Coinbase currently supports over 50 cryptocurrencies.|
|Security||2 Factor verification, device management, cold storage, address whitelisting||2 Factor verification, Insurance in case Coinbase security is breached, biometric logins, cold storage, AES-256 Encryption.|
|Max Trading Allowed||Depends on the cryptocurrency purchased||Depends on region and payment method|
|Fees||Purchase and trading fee varies from 0.02% – 0.10% and 3% – 4.5% on debit card purchases.||A flat fee of 0.50% on each trade, purchases made with credit card are charged 3.99% and 1.49% for wallet or bank account purchases. Wire transfers are charged $10 for deposits and $25 for withdrawals.|
|Orders||Limit, stop-limit order, trailing stop order, market order, peer to peer trading and other advanced transactions.||Receive, exchange, buy and sell.|
Now that we have a brief idea of how the two exchanges stack up against each other, let us explore what each exchange has to offer in a little more detail.
Both Binance and Coinbase take security very seriously. Coinbase has a slightly better reputation than Binance in terms of security, thanks in part to its backing by venture capitalists and banks like JP Morgan. It was also established much earlier than Binance. Binance was founded in China before the exchange moved to Japan. Currently, the exchange is headquartered in Malta.
Both Coinbase and Binance offer two-factor authentication for user accounts. This employs two passwords to secure your account, one set by the user, and the second is messaged to the user or created by an authenticator app like Google Authenticator. Let us look at each exchange individually.
Coinbase stores 98% of the funds offline in cold wallets, which are further stored in secure vaults and deposit boxes. It keeps only 2% of the total funds online, and an insurance policy also ensures that. However, the policy only covers breaches at the exchange’s end and not issues that arise at the user’s end. User funds are also kept completely separate from operating funds. Coinbase is also based in the USA and is subject to US financial laws, some of the world’s strictest laws. Coinbase ensures complete transparency when it comes to how and where it stores the funds of its users.
Binance is a little less transparent when it comes to user funds. Account security is on par with Coinbase, with users having the option to use additional security measures. However, there have been some issues such as missing funds for which Binance had to issue clarifications and offer discounts on trading fees.
Binance has also come under attack by hackers on more than one occasion, with their security team garnering significant praise for protecting user data. In March 2018, Binance came under attack by hackers, but the attack was picked up by internal security teams and thwarted, resulting in no losses of funds for Binance. Binance was breached in 2019, with hackers gaining access to API keys. However, Binance entirely covered all losses through their Secure Asset Fund for Users (SAFU), reimbursing all users that lost money.
Let’s look at some security features at each exchange.
- Whitelisting crypto addresses
- Two-factor authentication
- Trust wallet partnership
- Advanced verification
- Two-factor authentication
- Built-in wallet
- FDIC insurance
Binance has a vast list of cryptocurrencies that it offers its users, with over 500 options to choose from. The US exchange, however, offers only 52 coins. It also provides trading pairs based on Ethereum, Bitcoin, Binance Coin, and other Stablecoins such as Tether. In addition, users can use BNB to lower trading fees on the Binance exchange. Binance also hosts ERC-20, NEP-5, and BEP-2 tokens. Binance has also tied up with simplex, allowing users to purchase select coins using credit or debit cards. Some of the coins on Binance are Bitcoin, Ethereum, Bitcoin Cash, Ripple, Litecoin, etc.
Coinbase offers its users 51 cryptocurrencies on the regular exchange, while Coinbase Pro offers users 57 currencies. In addition, the exchange also supports fiat currencies such as EUR, USD, and GBP.
Both Coinbase and Binance have certain unique features that they both offer their users.
- Rewards – Binance gives out frequent rewards and giveaways to boost participation on the platform. These prizes can be claimed through the Binance Rewards Centre.
- Binance Academy – Binance Academy offers tutorials for beginners as well as advanced users.
- Charting – Users are able to create charting views by utilizing the embedded TradingView charts.
- Built-in newsfeed – Users of Coinbase have access to a built-in news feed, allowing them to stay updated on current developments in the crypto space.
- Educational videos – Coinbase users can access educational videos about various projects in the cryptocurrency space. Users that view the full video are rewarded with some cryptocurrency.
Before we get started with the fees, we must understand that three types of fees are prevalent when using a cryptocurrency exchange. These are Withdrawal fees, Deposit fees, and Trading fees. Let’s take a look at the fee structure at both exchanges.
Binance holds a significant advantage over Coinbase when it comes to fees. Compared to Coinbase, or even other exchanges in the crypto space, Binance has the lowest fees in the entire industry. This is because Binance offers users crypto-trading, which is cheaper than trades that involve fiat currencies. The exchange charges 0.1% for all trades, with discounts for trades carried out using Binance coin (BNB). You can look at the Binance fee structure here.
Coinbase, on the other hand, charges a 1.49% fee on each purchase or sale. This figure goes up to 3.99% when you use a credit card to make trades. Users can end up paying 4% per transaction on Coinbase. The rates on Coinbase are as follows
- Transactions up to $10 incur a fee of $0.99
- Transactions between $10-$25 incur a fee of $1.49
- Transactions between $25-50 incur a fee of $1.99
- Transactions between $50-$200 a fee of $2.99
Transactions above $200 incur a fee equal to 1.49% of the total transaction value. Coinbase charges fees lower than most exchanges offering similar services, but they are a bit on the higher side compared with exchanges like Binance. You can look at the Coinbase fee structure here.
Advantages And Disadvantages
Let us look at some of the advantages and disadvantages of each platform.
Advantages of Coinbase
- Coinbase is a very well-known exchange and has over 56 million users globally. The large number of users indicates the trust and security Coinbase has in the crypto community.
- Coinbase has an easy-to-use interface and a dashboard that is easy to understand and get used to. Navigation is easy to understand, and buying and selling cryptocurrencies even easier.
- If you are looking to invest in popular cryptocurrencies like Bitcoin, Ethereum, Litecoin, and other popular cryptos, then Coinbase is the platform for you. Currently, Coinbase supports over 50 currencies. However, the number of cryptocurrencies backed by the platform also depends on the region from where you are trading.
Disadvantages of Coinbase
- Transaction fees on Coinbase tend to be a little on the higher side unless you are using Coinbase pro. The platform has two memberships, A basic membership, and a Coinbase Pro membership. Coinbase charges a 0.5% spread fee in the basic membership and a “Coinbase fee” Coinbase Pro does not feature any fee above 0.5%.
- Coinbase has a smaller selection of altcoins when compared to some of its competitors.
- Coinbase does not allow its users control over their wallet keys, instead storing the cryptocurrencies in a wallet on the exchange that it controls. This process is a double-edged sword, as it makes the process somewhat easy for the user, but the user has to sacrifice a degree of control.
The Coinbase platform is considered suitable for newer cryptocurrency traders, traders interested in major crypto pairs, and traders who want to use a sleek and straightforward platform.
Advantages of Binance
- Binance is one of the most popular cryptocurrency exchanges in the world. Thanks to its massive user base, Binance processes nearly $4 billion in trading volumes each day.
- The platform supports a plethora of cryptocurrencies, ranging from popular cryptos to lesser-known ones. Binance supports currencies such as Ethereum, Bitcoin, Cardano, Litecoin, Bitcoin Cash, etc.
- Users on Binance can use BNB to carry out transactions on Binance Chain or trade it as a token. BNB is the third-largest cryptocurrency in the world, with a market cap of almost $79 billion.
- It offers users two-factor authentication and has a very proactive internal security team.
- The platform has several advanced trading features that are excellent for complex trades.
Disadvantages of Binance
- Binance can be a little difficult for beginners but has several advanced features that traders can use to execute advanced trades.
- Binance customer support is lacking in several cases. While the Binance platform has a lot of information for users, it is tough to reach out to a representative should a user need immediate assistance.
- The platform can also have a lengthy KYC process.
Which Exchange Should You Use?
Both Coinbase and Binance are excellent exchanges and depending on your trading goals, you can use either of the two exchanges.
Coinbase is an excellent platform for beginners with its simple and easy-to-use interface. Users can also transfer to GDAX (Global Digital Asset Exchange) and gain access to more cryptocurrencies. Coinbase also allows users to buy cryptocurrencies using fiat currency. The exchange is also an excellent option for small investors and businesses who are looking to invest in crypto.
Binance is also an excellent platform for beginners, but it also has several advanced features that traders can utilize to execute more complex trades. For example, experienced traders can view detailed statistics and price movements. Binance also offers significantly more cryptocurrencies than Coinbase.
How To Create An Account On Binance And Coinbase?
Let’s first look at how to set up an account on Binance. We’re going to be looking at how to register through the app.
- Open the app and click on “Register.”
- Enter the email you want to use with your account and create a strong password. Click on “Register” after reading the terms & conditions.
- Once you click on “Register,” you will come across a verification puzzle. Solve it.
- After this step, Binance will send a confirmation email to the email address specified.
- Open the email, click on “Check email address,” once you click on this, you will be redirected to the Binance website.
- Your account is verified, and you are set to trade.
Now let us look at Coinbase and how to set up your Coinbase account.
- Go to the Coinbase website or open the app on the mobile.
- You will be required to fill out your legal name, email address, create a strong password, and your country/state.
- After reading the terms & conditions, click on “Create Account.”
- Once you click on “Create Account,” you will receive a verification email. Click on “verify email.”
- You will be redirected to Coinbase and will have to sign in using your email and password.
- Now you will have to verify your phone number and add your personal information.
- Once this is complete, verify your identity by completing your ID verification.
- Link a payment method depending on which country you are signing up from.
For a more comprehensive tutorial on how to create your account, you can refer to this guide.
Both Binance and Coinbase have a KYC process that new users have to go through. However, the KYC process on Coinbase is much smoother and faster compared to Binance, which is known to take some time to complete KYC verification.
Is Coinbase better for beginners?
Coinbase is a very beginner-friendly platform and can be used by pretty much anyone, which is why it is the perfect platform for beginners. It has a clean interface, and as it is based in the USA, it is compliant with strict financial regulations.
Is Coinbase safe or Binance?
Both Coinbase and Binance offer 2FA via SMS or the Google Authenticator app. Binance offers address whitelisting, restricting addresses that can withdraw cryptocurrency. Advanced verification on Binance ensures that your identity on the platform is secured.
Coinbase offers its users a built-in wallet, protected with a password and biometric access. It also stores user assets offline. In fact, 98% of user funds are kept offline. Coinbase also offers FDIC insurance on USD deposits up to $250,000.
Can Coinbase be trusted?
Coinbase is among the most popular exchanges in the world today and has top-notch security features for users. It has features such as AES-256 encryption, cold storage, and other features. Coinbase is widely regarded as one of the most secure exchanges in the world.
Which exchange has better customer support?
A lot of exchanges are criticized when it comes to customer support. Both Binance and Coinbase could also improve when it comes to their support. Coinbase takes between 1-3 days to respond to customers while Binance support is considerably slow, especially during busy phases for the exchange.
Binance and Coinbase both have several similarities, allowing traders to buy, sell, and trade currencies. Both exchanges are user-friendly and offer beginners and advanced traders a host of features. Coinbase has a sleek and simple interface and is considered to be a good choice for beginners. It makes buying and selling extremely easy, and user funds are safely stored offline. When it comes to leading cryptocurrencies like Bitcoin and Ethereum, Coinbase is considered better than most other platforms. It also makes the purchase of currencies easy by using traditional transaction methods such as bank transfers and credit/debit cards.
Binance offers its users a more advanced platform, with a vast selection of cryptocurrencies, multiple trade options, and a relatively easy-to-use platform. As a result, Binance is quite popular with more advanced traders. Binance has a more advanced interface than Coinbase, and it also offers more flexible verification requirements for users who do not want to part with their personal information.
Both exchanges offer different services for different users, and depending on the trading requirements, both Binance and Coinbase are excellent exchanges for trading cryptocurrencies.