BlockFi Vs Coinbase: Which Platform Is Worth Considering for Crypto Investment?
Deciding on which platform to do your cryptocurrency trading can be a daunting task. There are so many options available, and new ones seem to be popping up all the time, today we are looking at BlockFi vs Coinbase. How can you know which one is right for you?
Luckily, we're here to help. In this article, we'll compare two of the most popular exchanges: BlockFi and Coinbase. We'll highlight every aspect of each, so you can make an informed decision about which one is right for you.
BlockFi Vs Coinbase: An Overview
BlockFi was founded in 2017 by Zac Prince and Flori Marquez which helps you manage your digital assets. The platform allows you to deposit your crypto into an account to earn interest on it, trade it, or take out a loan against it.
BlockFi is headquartered in New York City. The company has raised over $18 million in venture capital from investors such as ConsenSys, Galaxy Digital, and Akuna Capital. It is currently in the process of obtaining a BitLicense from the New York State Department of Financial Services.
One of the unique selling points of BlockFi is that they offer interest-bearing accounts for a number of popular cryptocurrencies, including Bitcoin, Ethereum, Litecoin, and others. This means that you can earn a return on your investment without having to sell your crypto or put it at risk in a volatile market.
BlockFi also offers loans against your crypto assets. This means you can borrow money without having to sell your crypto holdings, and you can use the collateral to secure a lower interest rate.
Coinbase was founded in 2012 by Brian Armstrong and Fred Ehrsam that allows users to buy, sell, and store digital currencies. Since its launch, it has become one of the most popular cryptocurrency platforms, with over 20 million users. The headquarter is based in San Francisco, California.
Coinbase operates a Global Digital Asset Exchange (GDAX), which is a cryptocurrency exchange. It also offers a wallet service, which allows users to store their digital currencies. Coinbase has been very successful and has raised over $200 million from investors.
The company is valued at over $1 billion. This network has been used by millions of people to buy and sell digital currencies. The company has also been working on expanding its services, such as adding support for more digital currencies and allowing users to trade with each other.
Not only does Coinbase have a robust user interface, but it also offers insured deposits and staking rewards for some proof-of-stake coins. This makes Coinbase an attractive choice for users looking to invest in cryptocurrencies.
Coinbase has its own stable coin (USDC) which is pegged to the US dollar. This makes it a great way to get started in crypto without having to worry about price volatility.
BlockFi Vs Coinbase: Security
Coinbase has never been hacked. 98% of their assets are stored in cold storage, which means you'll have nothing to worry about if something goes wrong with your crypto investments. All assets are insured up to $250K by FDIC and only 2% of assets are available online which are completely secured.
BlockFi's crypto assets are stored in a variety of different ways, with 95% being held safely away from cybercriminals through cold storage. The remaining 5 percent is protected by Aron and insured against any potential losses that may occur due to hacks or malware attacks on their hot wallets. It's important to note that BlockFi deposits are not protected by FDIC or other insurance, which makes them more susceptible in case something happens.
BlockFi Vs Coinbase: Ease of Use
Coinbase is a great exchange for beginners. They make it as easy and simply possible to buy crypto with just one click. To place an order, you select "buy/sell" from within your account settings page where there are plenty of cryptocurrencies available. In addition, the standard fiat currencies like USD or EURO can be used that most people will need when they first start out crypto trading on Coinbase.
You can start on Coinbase in two different ways. The first way is placing an order on Coinbase's Order Book page which shows all current transactions. The second one is clicking "Bid" under price point changes when looking at Buy Price histories.
With BlockFi, you can get your money back with no hassle if things go wrong. The company has customer support options for every need. Whether it's chat, email submitters, or phone calls, the company ensures to get your questions answered 24/7 during weekdays. Coinbase doesn't offer this kind of interactive service. So, make sure to try them out when looking into investing in cryptocurrency.
BlockFi Vs Coinbase: Interest Account
The BlockFi Interest Account is a revolutionary financial service that enables crypto holders to earn interest on their funds. The company instantly deposits assets into an online wallet, where they can collect daily or monthly dividends in any major currency of choice.
The idea behind these accounts is simple. Use your cryptocurrency as if it were fiat currency and earn some money on top of what you would have. However, you have always been able to withdraw from an exchange without paying any fees.
BlockFi is the only interest-bearing savings account that doesn't have a minimum balance requirement. You can get up to 11% APY on your money with no monthly fees or hidden charges.
Coinbase also makes it easy to earn interest on your crypto assets. With rates ranging from 4% all the way up to 8%, there's never been a better time than now for taking advantage of this lucrative feature. It allows you to make money just by letting others handle bookkeeping while you sit back and relax. All this means is that when loaned out, crypto grease the economic gears for increased profit.
With Coinbase, cashing out is easy. Just withdraw the coins from their smart contract and take them straight to your Coinbase Wallet app for immediate access. With this simple process available worldwide, making interest easier than ever before. It's never been more convenient or practical time-wise either way you look at it.
BlockFi Vs Coinbase: Fees Structure
The table below shows the difference in fees between BlockFi and Coinbase. You can see that there are quite a few differences, but one thing they both have is low trading costs for non-card users.
|0.50% per spread.||No trading fees|
|For deposits of $10 or less – $0.99||0.015 ETH per withdrawal|
|Over $10 and less than $25 – $1.49||2 LINK per withdrawal|
|Over $25 and less than $50 – $1.99||0.001 LTC per withdrawal|
|More than $50 and less than $200 – $2.99||0.035 PAXG per withdrawal|
|0.50% maker-taker fee||0.00075 BTC per withdrawal|
|1.49% fee per withdrawal|
Coinbase Pro is a friendlier fee system for traders than Coinbase. Coinbase Pro eliminates all fees, including maker-taker which can be quite hefty on other platforms. With no deposit or withdrawal fees, it's easy to see why many experienced crypto enthusiasts jump ship from the more expensive platform and go straight over to BlockFi.
BlockFi Vs Coinbase: Cards
BlockFi has created a Bitcoin-earning credit card that altered the crypto industry in several key ways. It's not just any old plastic, though; this one has an amazing $250 signup bonus and a 1.5% rewards rate on all your purchases.
BlockFi's new rewards credit card is perfect for anyone who wants to build their own finances and take control of how they spend. With better purchase protection, and higher rates of return on investments in your wallet with every BlockFi payout, this innovative product has it all.
The company is also building opportunities for people to establish their credibility with the bank by making purchases on this application. If they do well enough in those tests then maybe suddenly there will be more spots available.
Coinbase's new Visa-branded crypto debit card is a great way to spend your assets without having any annual fees or sign-up charges. The 4% earned on all purchases will help you get back in control of how much money goes out each month. Also, there are no limits when it comes time for spending.
The Coinbase Card lets you use your funds at any ATM around the world and makes purchases without having to exchange currency. There are many benefits of using this service, including being able to do business internationally with ease.
5 Major Differences Between BlockFi Vs Coinbase
- No Of Cryptocurrencies: Coinbase is a more established cryptocurrency exchange, with support for over 50 cryptocurrencies. However, BlockFi only offers some of the most popular ones. This could make it difficult if you're looking to invest in coins other than Bitcoin or Ethereum.
- Insurance: The BlockFi tokenizes USD accounts, but does not provide Federal Deposit Insurance Corp insurance. Coinbase offers up to $250K in qualifying bank account coverage with their company’s funds. Though this protection comes at a cost. You must maintain an active platform license which requires monthly fees based on your activity level.
- Fees: Coinbase's fees are not very clear, but they do provide a schedule for you to review before trading. This makes it easier than BlockFi which doesn't have one at all.
- Multiple Level Service: Coinbase has been around for a long time, and it offers many different services to its users. Coinbase Pro is more geared towards professional traders who want access on the go or those looking in from outside of America's borders. BlockFi only provides the basic service, but it's enough for most people.
- Loans: Both companies offer different rates of interest on loans with cryptocurrency, but it’s important to consider the APR. BlockFi's lowest 4% rate may be more attractive if you want to access or wish cash rapidly. On the other hand, Coinbase has an 8% which will require waiting for your payment before borrowing against crypto as well.
Pros & Cons of BlockFi
- Zero Fees for Swaps of Supported Assets – With BlockFi, you can exchange one cryptocurrency for another without paying any fees. This makes it a very convenient option for those who want to move their assets around quickly and easily.
- Lenders Earn Compound Interest on Deposits – When you deposit your funds with BlockFi, the interest starts compounding right away. This can result in a nice return on your investment over time.
- You Can Choose the Cryptocurrency in Which They Earn Interest – Not everyone is interested in earning interest in Bitcoin. With BlockFi, you have the option of choosing the cryptocurrency in which your funds will earn interest.
- BlockFi Visa Card that Offers Bitcoin Rewards – Another great feature of BlockFi is their Visa card that offers rewards in Bitcoin. This makes it easy to earn rewards and get paid in the currency of your choice.
- Lack of Regulation – BlockFi is not a regulated financial institution. This means that there is no government oversight of their activities. This could be seen as a positive or negative depending on your personal preferences.
- Limited Cryptocurrency Support – At the moment, BlockFi only supports a limited number of cryptocurrencies. This could be a downside for those who want to use the platform to hold or exchange other currencies.
- Lock-In Period for Interest Rates – One potential downside of using BlockFi is that the interest rates are locked in for a period of time. This means that if market conditions change, you may not be able to take advantage of the new rates.
Pros & Cons of Coinbase
- User-friendly design – When you are looking to make a purchase, Coinbase has made it incredibly easy. All you need to do is search for the asset you want to buy and then click on the button next to it. The price is also clear and upfront so you don’t need to worry about any hidden fees.
- Large selection of crypto assets and tokens – Coinbase offers a wide range of different cryptocurrencies for users to invest in. You can also find a variety of ERC-20 tokens on the site, giving you plenty of options to choose from.
- Have their own stable coin (USDC) – Coinbase has its own stable coin known as USDC. This is a great option for users who want to avoid volatility in the market and want a more stable investment. USDC is pegged 1:1 to the US dollar, so you can be sure that your investment will maintain its value.
- Significant identity verification required - in order to buy or sell cryptocurrency on Coinbase, you must provide your full name, date of birth, address, and phone number. You must also verify your identity by taking a photo of your driver's license or passport.
- Fees are right in the middle of industry standards - Coinbase's fees are slightly higher than some other exchanges, but they are still lower than most banks.
How do BlockFi and Coinbase work?
To get started with BlockFi and Coinbase, you first need to create an account by providing personal information like your name or government-issued ID. Then verify the authenticity of this documentation before making any deposits on either platform. It is different depending on what features they offer in terms of financial services (Coinbase could be purchasing cryptocurrency while BlockFi gives interest.
Who Should Use BlockFi vs. Coinbase?
Coinbase is a great option for beginners who want an easy way to buy and sell cryptocurrencies. If you need cash fast and want to avoid getting hit with high-interest rates, BlockFi might be your best option.
So, which exchange should you choose? It really depends on what you are looking for. If you want a wide range of cryptocurrencies and are willing to pay slightly higher fees, then Coinbase may be the better choice. However, if you want a more reliable and trustworthy platform with lower fees, then BlockFi may be the better option.
Both BlockFi and Coinbase offer a variety of ways to earn interest on your cryptocurrency holdings, but the APYs paid by each company differs. For example, at the time of writing, BlockFi is paying up to 8.6% APY on Ethereum (ETH) deposits while Coinbase is only offering up to 5% APY. So, if you’re looking to earn the most interest in your crypto, BlockFi is the better choice.
However, when it comes to borrowing against your cryptocurrency, Coinbase may be a better option. That’s because BlockFi requires a minimum loan amount of $2,000, while Coinbase has no such minimum. So, if you only have a small amount of cryptocurrency to borrow against, Coinbase is likely your best bet.