Where do you start as a budding crypto day trader? Cryptocurrency isn’t really traded at your local grocery store. First thing first, you have to pick a cryptocurrency exchange.
Both Coinbase and Crypto.com are obvious choices due to their widespread recognition and universal acclaim. Which one is better, though, and why?
So, you’ve heard of the cryptocoin gold rush. The Bitcoin rags-to-riches story finally triggered your inner call for fortune and you’ve decided to answer.
You read some guides, listened to some podcasts, you think you’ve got the basics of this thing. But then comes the first, often overlooked step and you get puzzled again. Before you start trading, you have to pick a crypto exchange on which this trade will occur.
There’s a whole bunch of crypto exchanges out there, some niche, some general, with various degrees of recognition, validity, and relevance. For the sake of this review, we chose Coinbase and Crypto.com as some of the most used cryptocurrency exchanges out there.
Both of these are phenomenal, but their core mechanics, the way they charge fees, and visual design can be starkly different. Depending on your needs and preferences, you will prefer one over the other. Let’s get going.
What are Cryptocurrency Exchanges?
Put simply, cryptocurrency exchanges are stock exchanges for digital crypto tokens. They rely on order books that get filled with buy and sell orders just as stock exchanges do. However, there are notable differences.
The principle does not differ. Investors mark the price at which they intend to buy or sell an asset and these bids get queued into the order book.
Afterwards, the market price of the asset at hand amounts to the lowest sell order in the order book. Once a purchase has been made at this price, the next lowest order becomes the market price for the next transaction, and so on.
The main point in which crypto exchanges are different from stock exchanges is the fact that, while the stock market operates only on weekdays from 9 AM to 4 PM, crypto exchanges never close and remain fully operational 24/7, every day of the year.
This adds more dynamics to the already not-that-stable nature of cryptocurrency, but rewards diligent (or resourceful) day traders.
The 3 Key Features of Cryptocurrency Exchanges
For serious crypto traders, sticking with the first crypto exchange that they stumble upon just doesn’t cut it. It is not enough for a place just to be able to sell coins.
When traders go looking for a good cryptocurrency exchange, there are three crucial factors that decide how good a crypto exchange really is.
The usefulness of a crypto market tends to be measured by the variety and total number of assets in stock, so the usual top priority for cryptocurrency investors when looking for their optimal exchange is the number of supported altcoins and tokens.
If an exchange that you’re using doesn’t support the coin you want to trade, it can’t be of use to you at all and you’ll have to start looking elsewhere.
The second priority, especially to those who deal with high-frequency trading, is trading fees. Depending on the way the exchange charges for its services, traders might have to pay a percentage or a flat fee for every transaction.
For example, high-frequency traders do not prefer the flat fee due to exponentially higher costs involved.
Finally, there is the issue of security as the third priority. Just as you wouldn’t deposit your fiat cash in a bank with favorable interest rates but which has numerous safety hazards, you would probably wish to skip crypto exchanges with mediocre security measures and/or a history of hacking breaches.
Digital currency can still be stolen from you, so bear in mind to always trust your crypto coins with someone responsible and reputable.
For example, 2-factor authentication (2FA) is an indicator of a thorough safety policy and exchanges which lack it should be avoided.
Additional Tip – Crypto Trading Bots
It is worth mentioning that some crypto exchanges offer crypto trading bots if you choose to trade with them.
Crypto trading bots are trading automation software that drastically outperform human traders in almost every aspect. First of all, they don’t need time off for rest or leisure and remain active around the clock, every day of the year, which is a feat that is impossible for every human (as far as we know).
Second, the speed with which they act upon a lucrative trade is limited only by the connection latency and amounts to fractions of a second.
In other words, before a human brain registers a potential trade on the screen and sends the impulse to the brain to click, the bot has already made the trade.
There is a catch, though – bots have to be programmed with a good trading logic in order to be successful. Different market circumstances lead to different optimal strategic approaches, and mentally processing the situation is an option that is unavailable to bots, sadly.
Here lie the differences between a good trading bot and one that is not as good.
The perfect trading bot balances between simplicity and performance. A bot that has two functions is bad, but a bot with all the functions in the world that requires a decade and a degree to master is also bad.
If you notice a crypto bot that is a part of a crypto exchange offer, bear in mind that integrated crypto bots are not always the best option, depending on which exchange you pick for yourself.
There are a lot of good options out there that you’ll be looking to replace your generic bot with, some for free, some with negligible costs related to them.
Coinbase is a well-known name in the crypto trading community due to its widespread use and extensive features that attract many users. A couple of these features can even be found on Coinbase only and nowhere else.
One of these features is Coinbase Earn, a program developed to both incentivize and educate on using and trading cryptocurrency. Those who choose to partake in this “course” can pick among different cryptocurrencies and learn the basics of it.
Afterwards users answer a couple of questions and Coinbase awards your account with the altcoin you just learned about, free of charge.
Another massively popular Coinbase feature is its cryptocurrency conversion. In essence, Coinbase uses it in order to allow direct conversion of one of its supported assets to another, completely free.
This removes the need for going through a buying process and cuts the fees of additional transactions, which is a huge deciding factor for most crypto day traders out there.
Crypto.com does not lag behind Coinbase in popularity, and is also a household name among cryptocurrency enthusiasts. There’s hardly a relevant cryptocurrency out there that doesn’t have a trading port in Crypto.com.
To prove that it is much beyond a typical crypto exchange, Crypto.com has a diverse set of features that serve to gather a following around it.
An example of these is Crypto.com’s crypto-backed debit card which allows Crypto.com’s users to freely spend their cryptocurrencies via a Visa-type card and earn additional boons and rewards in the process.
This exchange also boasts a particularly favorable incentive to store cryptocurrencies onto it. Namely, Crypto.com’s developed ecosystem allows you to earn interest on cryptocurrency and stablecoins at your disposal.
Stablecoins’ return on investment goes about 12% per annum in interest, and cryptocurrencies go as high as 6.5% per annum. As a policy of attracting dedicated long-term traders, this is both very popular and very useful to everyone who’s willing to wholly stick with Crypto.com.
Coinbase Fees vs. Crypto.com Fees
Taking both crypto exchanges into account, it can be observed that Crypto.com requires less from users in fees. In fact, Crypto.com takes 0.4% in fees per trade, with a discount to this rate if the user is a Crypto.com card holder. Crypto.com charges a much higher rate for credit card purchases, topping at 2.99% per each credit card transaction.
On the other hand we have Coinbase the fees of which amount to 1.49% per transaction. In addition to this, Coinbase has a maximum spread of 0.5%, which basically means that users may end up paying slightly above the market price for their preferred cryptocurrency investment. Opting for a credit card as a means of purchasing crypto has its associated fee of 3.99% on Coinbase.
It is worth mentioning that Coinbase has reduced fees with their Coinbase Pro version. Coinbase Pro has a bit more demanding user interface, though, but its fees can be significantly lower for more dedicated day traders than in the normal Coinbase app.
Coinbase Security vs. Crypto.com Security
As established crypto exchanges, both Coinbase and Crypto.com have invested heavily into their security. Recognizing security as one of the three key aspects in a good exchange, both of these platforms tend to be as reliable and safe as possible.
Put in precise numbers and policies, for example, both platforms have insurement policies on USD deposits up to $250,000. Why are they so sure that you won’t lose money with them? Well, one of these reasons is that they use cold storage or offline cryptocurrency wallets to preserve the safety of their digital funds.
Cold storage works by “downloading” cryptocurrency to a safe offline or hardware storage module. Even if a security breach does happen on the platform, hackers will not be able to siphon funds since the site has no front or backdoor that leads the intruders to crypto wallets except for a small portion put into circulation.
Altcoins Supported – Coinbase vs. Crypto.com
Both Coinbase and Crypto.com have significant and extensive support systems for different cryptocurrencies. Apart from Bitcoin and Ethereum, a wide range of altcoins are supported by both of these platforms.
The fact remains, though, that there are coins that can be found on one platform but not the other, so make sure to check where to find your preferred cryptocurrency.
Top Altcoins Available on Coinbase but not on Crypto.com
Top Altcoins Available on Crypto.com but not on Coinbase
- Axie Infinity
- Shiba Inu
- The Sandbox
Top Crypto Coins Available on both Coinbase and Crypto.com
- Basic Attention Token
- Bitcoin Cash
- Ethereum Classic
- Internet Computer
- Kyber Network
- Stellar Lumens
- The Graph
- Wrapped Bitcoin
Reaching a final conclusion in reviews that pit two cryptocurrency giants against each other is never easy, and tends to be unfair to either party. This review is not an exception.
Both crypto exchanges, Coinbase and Crypto.com, have their advantages and aspects in which the rival performs better. These are slight nuances, however, and do not take away much from the overall performance of one or the other.
For example, Crypto.com supports more cryptocoins than Coinbase, even though Coinbase has a huge assortment itself. On the other hand, users who favor simplicity over min-maxing tend to slightly favor Coinbase over Crypto.com.
That said, Crypto.com has an amazing program that can help you earn more with cryptocurrency through spending via their debit card, which counterweights the argument for simplicity a bit.
Precisely because of these slight differences that overlap, overturn, or complement each other, we will not make the final choice and leave that decision to you. After all, it boils down to personal taste and needs.
How to decide? Try them both!