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By Ashwani Shoda
Published on 2 Jul 2024 8 min read
In cryptocurrency trading, choosing the right platform can make all the difference. Two popular options that continue to dominate the market are eToro and Coinbase.
But which popular cryptocurrency exchange is truly worth your investment?
Whether you’re a seasoned trader or just starting out, understanding the similarities and differences between these platforms will help you make an informed decision.
Let’s dive into a side-by-side comparison of these two giants in our ultimate showdown: eToro vs Coinbase.
In this blog, we will break down their features, fees, security measures, and more to help you decide where to grow your digital assets.
So grab your virtual seat as we delve into the two popular cryptocurrency trading eToro and Coinbase!
What Is eToro?
eToro is a leading social trading and online brokerage platform that allows users to access various financial markets, including stocks, cryptocurrencies, commodities, ETFs, and more.
Founded in 2007, the platform has gained immense popularity globally among traders and investors.
One key feature that sets eToro apart from other trading platforms is its unique social aspect. Users can interact with other traders on the platform, follow their strategies, and even copy their trades automatically.
This innovative feature makes it easier for beginners to learn from experienced traders while providing a sense of community within the eToro ecosystem.
Moreover, the platform’s sleek design and intuitive layout make it easy for users to navigate different markets and instruments. It also provides comprehensive market analysis tools, customizable charts, and real-time data updates to help users make informed trade decisions.
Its diverse range of financial instruments and markets makes it an ideal choice for traders looking to diversify their portfolios.
What Is Coinbase?
Coinbase is a popular cryptocurrency exchange platform founded in 2012 by Brian Armstrong and Fred Ehrsam. It is based in San Francisco, California, and has quickly become one of the world’s largest and most well-known exchanges. As of 2021, Coinbase has over 56 million verified users from more than 100 countries.
In simple terms, Coinbase acts as a middleman between buyers and sellers of cryptocurrencies such as Bitcoin, Ethereum, Litecoin, and many others. This means you can buy or sell these digital assets directly through the platform without going through a third party.
One of the main reasons for Coinbase’s popularity is its user-friendly interface. Its simple and intuitive design makes it easy for beginners to navigate the world of cryptocurrency trading.
Additionally, Coinbase offers a mobile app for iOS and Android devices, allowing users to trade on the go.
Another notable feature of Coinbase is its trading platform, Coinbase Pro. This platform caters more to experienced traders by offering advanced charting tools and lower fees than the regular version of Coinbase.
It also offers additional services such as staking and advanced security features like cold storage wallets, making it a better alternative to no-KYC crypto exchanges.
Similarities Between eToro and Coinbase
EToro and Coinbase share several similarities, making them popular choices for buying and selling cryptocurrencies. Therefore, choosing between eToro and Coinbase depends on the user’s preferences and investment goals.
So, we have compiled them all below to help you get all the information and make an informed decision.
1. User-Friendly Interface
One key similarity between eToro and Coinbase is their user-friendly interface. Both platforms have been designed with a focus on simplicity and ease of use, making them accessible for beginners to understand and navigate. This feature makes it easier for users to buy or sell cryptocurrencies hassle-free.
2. Multiple Cryptocurrency Options
Another similarity between eToro and Coinbase is that they offer a wide variety of cryptocurrency options for users to choose from. Both platforms support some of the most popular cryptocurrencies, such as Bitcoin, Ethereum, Litecoin, and more.
This allows users to diversify their portfolio by investing in multiple coins through one platform.
3. Mobile Apps
In this digital age, having access to services on the go has become essential. Both eToro and Coinbase offer mobile apps for iOS and Android devices, allowing users to manage their investments anytime and anywhere.
4. Security Features
Cryptocurrency exchanges are often targeted by hackers due to the value of digital assets present on the platform. Therefore, eToro and Coinbase have implemented strict security measures to protect user funds.
They use advanced encryption technology such as SSL certificates, two-factor authentication (2FA), cold storage for storing cryptocurrencies offline, etc., ensuring maximum security for user transactions.
5. Knowledge Resources
eToro and Coinbase provide educational resources such as blogs, videos, and tutorials that help beginners understand how cryptocurrency trading works.
These educational materials benefit new traders and experienced ones who want to expand their knowledge about cryptocurrencies.
6. Customer Support
Both platforms offer excellent customer support services through various channels, such as live chat support, email support, or phone call assistance, in case users have any issues or queries.
This feature is crucial for users, especially beginners, who may need assistance navigating the platform.
Differences Between eToro and Coinbase
One major distinction between eToro and Coinbase is the trading experience. eToro is a multi-asset investment platform that provides financial services. However, it has become a popular choice of investors for crypto trading due to its social aspect. It allows users to interact with each other and even copy successful traders’ strategies.
On the other hand, Coinbase is a crypto exchange platform where you can buy, sell, transfer, and store digital currencies like Bitcoin, Ethereum, and Dogecoin.
Like traditional trading platforms, Coinbase shows you the current price and trends, real-time holdings in your portfolio, and industry trends. It also offers more advanced trading features such as margin trading and stop-loss orders for experienced traders.
While both eToro and Coinbase are reputable trading platforms for smart investing, they have significant differences that cater to different types of investors.
eToro caters more to novice investors looking for a user-friendly platform to invest in multiple assets to diversify their portfolios.
On the other hand, Coinbase is geared towards more experienced traders and investors who want access to advanced trading tools and features for crypto trading.
Supported Cryptocurrencies of eToro and Coinbase
eToro’s wide selection of coins makes it an attractive option for traders who want to diversify their portfolios or invest in emerging digital assets.
The platform currently supports 25 cryptocurrencies, including the most popular and established coins such as:
- Bitcoin
- Ethereum
- Bitcoin Cash
- Litecoin
- Stellar
- Ethereum Classic
- IOTA
- EOS
- NEO
- ZCASH
- Tezos
- Maker
- Compound
- Chainlink
- Uniswap
- Shiba (in millions)
- Yearn.finance
- Dogecoin
- Aave
- Enjin
- Basic Attention Token
- Algorand
- Dash
- Decentraland
- Polygon
While this provides users with more options than before, it still falls short of Coinbase’s diverse selection. Coinbase used to focus mainly on the top cryptocurrencies at the start but has now added some lesser-known coins.
Currently, it has over 170 tradable cryptocurrencies listed on its platform. This includes well-known names such as:
- Bitcoin (BTC)
- Ethereum (ETH)
- Litecoin (LTC)
- Ripple (XRP)
- Bitcoin Cash (BCH)
It also offers support for lesser-known coins like Cosmos (ATOM), Kyber Network (KNC), Chainlink (LINK), Compound (COMP), and Tezos (XTZ).
While both platforms offer a good selection of supported cryptocurrencies, Coinbase edges out eToro with its wider variety of coins. Coinbase supports all popular coins with high trading volumes, making it easier for users to buy and sell their assets.
However, it ensures that only trustworthy coins are added to their platform after thorough evaluations, giving users a sense of trust when investing in these assets.
Fees Structure of eToro and Coinbase
Both eToro and Coinbase have advantages in terms of fees. While eToro’s spread-based fee structure may be more straightforward for beginners, Coinbase’s maker-taker model may appeal to more experienced traders looking for lower fees on larger trades.
eToro has a transparent fee structure with no hidden charges. The platform charges a spread on each trade, the difference between an asset’s bid and ask prices.
The spreads vary depending on the underlying asset and can range from as low as 0.75% for major cryptocurrencies like Bitcoin and Ethereum to higher rates for less popular coins.
In addition to spreads, eToro also charges overnight fees for leveraged positions held open beyond market close. These fees are calculated based on the leverage used and the size of the position. Traders can easily view these fees before opening a trade, giving them full transparency over potential costs.
On the other hand, Coinbase operates on a slightly different fee structure.
It follows a maker-taker model where fees range from 0% to 0.50%, while the taker fee can be as high as 3.99%. While higher trading volumes and liquidity attract lower fees, it can become a significant expense for small traders.
For transactions under $10,000 USD, makers and takers pay 0.50% per trade; however, this decreases to 0% for makers and 0.30% for trades above $10 million USD.
Apart from trading and transaction fees, Coinbase charges a network fee or “miner’s fee” for every transaction made on their platform, usually ranging from about 0.00001 BTC to 0.00004 BTC per transaction.
Coinbase also charges deposit and withdrawal fees based on payment method and country of residence.
For example, US customers using ACH transfers or bank wires do not incur deposit or withdrawal fees; however, international wire transfers have additional costs ranging from $10-$25 USD.
Pros and Cons of eToro and Coinbase
eToro and Coinbase offer a user-friendly interface, multiple payment options, and a wide range of cryptocurrencies to trade. However, like any other platform, they have their own set of advantages and disadvantages.
Here are the pros and cons of using eToro and Coinbase for cryptocurrency trading.
Pros of eToro
✅ 1. Social Trading
eToro’s social trading function allows users to interact with other traders on the platform, view their portfolios, copy their trades, and even communicate with them directly.
This can be an invaluable tool for beginners who can learn from experienced traders or for busy individuals who do not have the time to trade actively.
✅ 2. Wide Range of Assets
eToro offers diverse assets, including stocks, commodities, forex, indices, and cryptocurrencies. This means that users can diversify their portfolio beyond just crypto assets, which can help minimize risk.
✅ 3. Multiple Payment Options
eToro offers various payment methods, such as credit/debit cards, bank transfers, PayPal, Skrill, and Neteller, making it convenient for users from different countries to deposit funds into their accounts.
Cons of eToro
❌ 1. Limited Cryptocurrency Selection
While eToro does offer some popular cryptocurrencies, such as Bitcoin (BTC) and Ethereum (ETH), it has a limited selection compared to other platforms like Coinbase, which supports over 170 cryptocurrencies.
❌ 2. Built-in Fees
Unlike some platforms, which charge a fixed fee per transaction or trade users make, eToro sets have built-in fees for trading and withdrawal that can add up over time.
Pros of Coinbase
✅ 1. Wide Range of Cryptocurrencies
Coinbase supports over 170 cryptocurrencies, making it one of the most comprehensive platforms for crypto trading.
✅ 2. High Liquidity
With its large user base and high trading volume, Coinbase offers high liquidity compared to other platforms, making buying or selling cryptocurrencies at any given time easier.
✅ 3. Beginner-Friendly
Coinbase is known for its simple and easy-to-use interface, making it an ideal platform for beginners to learn about cryptocurrency trading.
Cons of Coinbase
❌ 1. Limited Payment Options
Unlike eToro, Coinbase has limited payment options, with only credit/debit cards and bank transfers being accepted as deposit methods.
❌ 2. High Fees
Coinbase has higher fees than other platforms, with transaction fees ranging from 0.5% – 4%.
❌ 3. Lack of Advanced Trading Tools
Coinbase is primarily designed for beginners and lacks advanced trading tools that experienced traders may need for technical analysis.
Both eToro and Coinbase have unique strengths and weaknesses, so it ultimately depends on your preferences and trading style. If you are looking for a social trading platform with a diverse selection of assets, eToro may be the better option.
On the other hand, if you want access to a wide range of cryptocurrencies and high liquidity, Coinbase may be the preferred choice.
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