Coinbase vs Binance Which One is Best for You?

If you are just beginning your journey into the cryptocurrency world, you can't miss this straightforward guide to Coinvase vs Binance.

Dean Fankhauser10 min read
Coinbase vs Binance: Which One is Best for You? | Bitcompare

Cryptocurrency has come into its own in recent years. What was once a niche investment opportunity for tech enthusiasts has risen to become an industry in its own right. The crypto market is currently valued at $327 billion USD as of September 2020.

Cryptocurrencies are becoming an established investment opportunity for forward-thinking investors. 4.86% of millennials have invested in cryptocurrencies. That's compared to 2.77% of Gen X and 1.58% of Baby Boomers.

Popular cryptocurrencies like Bitcoin remain the best-known cryptoassets on the market, which is currently valued at $188 billion. Bitcoin and Ethereum are certainly not the only game in town, however.

Today, we're going to take a look at some of the most popular crypto exchanges. Binance is regularly rated as the 1 cryptoexchange. Coinbase is also quite popular, especially for those looking to trade altcoins.

If you're looking to decide between Coinbase Vs Binance, here's our side-by-side comparison to help you decide which cryptoexchange is best suited for your trading and investment needs.

Coinbase Vs Binance: Which Cryptoexchange Is Right For You?

To help you decide between Coinbase Vs Binance, let's start by taking a look at each of these popular cryptoexchanges. Understanding how each work will help you decide which exchange is right for you.

What Is Coinbase? 

Both Coinbase and Binance are crypto exchanges, but in reality they are very different. Coinbase is a crypto broker exchange, for one. That means Coinbase acts as a middleman instead of bringing buyers and sellers together directly. Founded in San Francisco in 2012, Coinbase has risen to become one of the most popular crypto  exchanges in the world, currently operating in 103 different countries, including the U.K., Spain, and Mexico.

Crypto exchanges can vary in the types of trading they allow. This ranges from the types of cryptocurrency they trade, purchasing coins with fiat currency, the amount of transaction fees, and how long it takes to process exchanges. Coinbase is particularly popular for making purchases with fiat currency. It's especially secure for making purchases with legal tender.

Coinbase also offers a clean, clear, understandable interface, making it an excellent choice for investors looking to get into cryptocurrency and cryptoassets for the first time. Coinbase features lengthy processing times, however, sometimes as long as three to five days. This makes it slightly preferable for investors getting into cryptocurrencies for the first time than for regular crypto traders.

Another thing to keep in mind is that you can't store cryptocurrency on the platform. You'll need a wallet for that. A crypto wallet can come in the form of hardware, software, or online services. Wallets are intended to keep someone's assets secure if a crypto network gets hacked. Coinbase can boast that the network has never been compromised, although individual accounts have. If you're thinking about using Coinbase, you'd be wise to set up an independent wallet just to be safe, or to use some other form of wealth management platform like BlockFi.

Coinbase supports most of the major cryptocurrencies, including:

  • Bitcoin
  • Ethereum
  • XRP
  • Litecoin
  • Bitcoin Cash

Coinbase offers the option of upping your trade limit based on the amount of ID data you provide. The final cap is at $50,000 USD or €30,000 euro. Coinbase also offers variable fees depending on the cost of the transaction. Coinbase's trasaction fees are as follows:

  • $.99 for buying or selling at $10.99 or below
  • $1.49 for buying or selling at $11 to $26.49
  • $1.99 for buying or selling at $25.40 to $51.99
  • $2.99 for buying or selling at $52 to $78.05

After $78.05, fees vary according to what payment method you're using.

Coinbase is the first crypto exchange to become a financial unicorn, which is a company valued at over $1 billion USD. Coinbase's c--founder, Brian Armstrong, has been featured as #10 on Forbes' 40 Under 40 list.

All of these factors, taken together, makes Coinbase one of the most dependable, legitimate businesses in the crypto market.

For more information about Coinbase, check out our comprehensive Coinbase Review: What You Need to Know Before Using it.

Now let's take a look at Binance. Then we'll compare the two to help you decide which crypto exchange is right for you.

What Is Binance?

Now let's take a look at Binance, to further investigate Coinbase vs Binance. As we stated at the beginning of this article, Binance is one of the most popular crypto exchanges among a number of crypto investors. It's especially beloved by those looking to exchange between different types of cryptocurrencies.

Binance offers two options for trading cryptocurrencies - basic and advanced. Even the basic version can be a bit daunting for those who are new to trading cryptocurrencies. If you know what you're looking at, however, Binance's in-depth dashboard will thrill crypto enthusiasts with its powerful analytics.

Although it can be a bit confusing, the Binance basic trading option is clearly displayed and easy to understand. Prices are on the left. Graphs are in the centre, presenting data in a clean, intuitive way that is easily understandable. The buy and sell boxes are on the right, along with their trade history so you can see their latest prices at a glance.

The advanced trading options offer even more in-depth technical insights for keep track of trading histories in all manner of useful ways.

Binance requires you to sign up for an account before you can begin trading. Luckily, this is easy to do, at least for a basic account. This does impact how much you're able to withdraw, however. Basic accounts, which are known as Level 1, can withdraw up to 2BTC a day.

Higher withdrawal limits require additional levels of security. To get to Level 2, you'll need to upload a photo ID then wait for approval. This results in a limit of 100BTC per day. There are levels with even higher limits, requiring you to contact the site directly. Verification depends upon how many agents are available, so plan accordingly if you're preparing to withdraw more than 100BTC.

Once you're set up with an account, you'll need to fund it before you can make any investments. This is easy to do, as well. Simply navigate to the 'Funds' tab on Binance and select 'Deposit/Withdrawal.' Then give them your wallet address. Keep in mind that it takes some time for your deposit to process as it is reliant on that currency's blockchain.

Once your account is funded, you're ready to begin trading. You'll be given access to virtually every cryptocurrency there is. You'll also have access to the widest-possible array of initial coin offerings (ICO) and their respective utility tokens. The access to ICOs is one of Binance's greatest selling points, as Binance processes ICOs faster than any other crypto network. This alone makes the trading platform worthy of consideration for crypto investors.

Once you've funded your Binance account, it's simple to start trading. Like Coinbase, there are "Basic" and "Advanced" options. To make a trade, select the tab for the cryptocurrency you'll be trading in. Then you'll be able to choose from virtually any cryptocurrency on Earth. You're also given the current value of the cryptocurrency as well as a brief trade history, also similar to Coinbase.

Once you've selected the currency you want to purchase, simply choose it from the list. This brings up a purchase window, where you can select how much of the cryptocurrency you want to purchase - 25%, 50%, 75%, or 100%, depending on how much funding you have available.

Binance also supports a wide array of cryptocurrencies for funding, including:

  • Bitcoin
  • Bitcoin cash
  • Dash
  • Ethereum
  • Ethereum classic
  • GAS
  • LiteCoin
  • Ripple
  • Zcash

Binance also offer their own cryptocurrency and coin offering, BNB. This alone makes Binance worth considering as an investment strategy. Every quarter, Binance dedicate 20% of their profits to buying back BNB. They'll contnue to do this until they've purchased back 50%, or approximately 100MM, of BNB.

Binance also features some of the lowest fees of any crypto exchange. The crypto exchange charges an average of .1% for each trade. Traders using Binance coins get an even bigger discount on these already low rates. Using Binance coins gets you a discount of up to 50% on trading fees.

Each cryptocurrency also has its own withdrawal rate - .1% is just the average. An example of Binance's withdrawal fees are as follow:

  • Bitcoin - .001 BTC
  • Ethereum - .01% ETH
  • Litecoin - .01% LTC
  • NEO - Free
  • Qtum - .01 Qtum
  • Status - 10 SNT
  • Bancor - 1.2 BNT
  • EOS - .7 EOS
  • Bitcoin Cash - .0005 BCC
  • GAS - Free

In addition to featuring low withdrawal rates, Binance is also one of the most secure crypto exchanges around. They're not super forthcoming on how they're securing their network, but they mention two-factor authentication on their website. Binance also features multi-tier system architecture, which further helps ensure the network's security.

This is evident given the fact that there was an attempted hack in March 2018. Hackers had been gathering users' login info via a phishing website. Then they tried to withdraw those funds all at once, transferring the funds to Bitcoin which they used to buy Viacoin, greatly exaggerating the price. They then tried to sell off both the Viacoin and BTC and withdraw the profits to their wallets.

This attempted to hack proves two things about Binance. For one, their two-factor authentication is clearly working. It also proves their serious about network security, as they've offered a bounty of $25,000 to anyone who can help them catch and prosecute the hackers.

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Coinbase Vs Binance: Choosing The Right Platform

All of this brings us back to our original question - Coinbase vs Binance? How do you know which crypto exchange to choose?

As you can tell from reading this article, comparing Coinbase vs Binance is really like comparing apples and oranges. While they both have a similar configuration, they fulfill a very different role and function.

Coinbase is, first and foremost, a crypto broker exchange. They act as a middleman and make purchases of cryptocurrencies on your behalf. Binance, on the other hand, is more of a proper crypto exchange. That is to say they're primarily concerned with trading one form of cryptocurrency for another.

This gives us our first rule of thumb for decided between the two. If you're newer to trading cryptocurrency and cryptoassets, Coinbase is likely going to be a better choice for you. This is mostly to do with their easily understandable interface and the ease with which you can convert fiat currency into cryptocurrencies.

Binance is going to be a better fit for more serious crypto traders. If you've already got cryptocurrencies and want to be able to convert them into other forms of cryptoassets easily, Binance is going to be a dream come true for you.

Binance is also preferable for people who trade crypto extensively. Their withdrawal fees are some of the lowest you can find. Binance's withdrawal fees become practically non-existent if you're paying with BNB.

Binance is going to be more preferable for people looking to take advantage of crypto as an investment opportunity. This is mostly to do with the fact that ICOs and utility tokens reach the network faster than any other, meaning you'll get dibs on new offerings before any other investors.

Both networks are excellent, however. They're just excellent in different ways. Both feature high levels of security, so you can invest in crypto with confidence. Both are also easy to understand and navigate with clear, clean user interfaces, although their central dashboards may look somewhat daunting at first glance.

Either way, both Binance and Coinbase give you all of the tools you'll need to take advantage of the exciting world of new investment opportunities that is cryptocurrency.

Are You Looking For More Crypto News And Resources?

Cryptocurrencies and decentralized finances are some of the most exciting financial innovations since the Industrial Revolution. Whether you're looking to decide between Coinbase vs Binance or the latest Bitcoin fork, we've got everything you need to stay on the cutting-edge of this exciting new industry.

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