BlockFi vs. Coinbase: Comparing their features and fees
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Updated: January 08, 2024
On November 10, 2022, BlockFi announced that it had to suspend withdrawals from its platform due to the FTX liquidity crisis. As of November 28, 2022, BlockFi officially declared bankruptcy. In October, 2023, BlockFi emerged from bankruptcy and announced it will wind down operations and begin returning crypto assets to customers.
While there’s no shortage of cryptocurrency exchange platforms to choose from today, BlockFi and Coinbase are two popular choices. While both offer a lot of features, there are some differences that may make one a better fit for you.
In this head-to-head comparison, we’ll present the differences between BlockFi and Coinbase to help you decide which cryptocurrency exchange is right for you.
The short version
- BlockFi is a great choice for low fees and earning interest, while Coinbase is better for educational resources and access to more crypto trading options.
- Coinbase provides an easy-to-use trading platform, institutional perks, staking, and digital asset storage for users in more than 100 countries.
- Both crypto exchange platforms are suitable for beginners, but Coinbase offers an advanced Coinbase Pro platform for more experienced crypto traders.
BlockFi vs. Coinbase: overview
What is BlockFi?
BlockFi is the brainchild of Zac Prince and Flori Marquez. In 2017, the duo created the crypto platform.
Traders can buy, sell, and trade cryptocurrencies on BlockFi. But the crypto exchange goes a step further by offering interest rewards on the BlockFi Interest Account (BIA) for non-U.S. residents. This means traders can earn interest on any crypto sitting idly in their accounts.
Recently, BlockFi’s BIA’s drew the ire of the Securities Exchange Commission (SEC), which charged that the accounts were unregistered securities. In February 2022, BlockFi settled with the SEC and agreed to pay $100 million in penalties.
As part of the settlement, BlockFi agreed to create a new first-of-its-kind SEC-registered product called BlockFi Yield (BY). Until BlockFi Yield launches, U.S. residents won’t be able to open new BIAs. Existing customers will continue to earn interest but won’t be able to add new assets. BIAs are still open to customers who live outside the United States.
What is Coinbase?
Coinbase Global Inc is a U.S.-based cryptocurrency exchange founded by Brain Armstrong. The crypto trading platform has been around a little longer than BlockFi, coming on the crypto trading scene in 2012.
Coinbase is a mobile-friendly cryptocurrency exchange and trading platform. And it allows crypto investors to buy crypto using a credit card, debit card, or directly from a bank account via bank transfer.
As one of the largest cryptocurrency exchanges in the United States, Coinbase offers more than 150 coins for trading, and crypto investors can buy and sell these crypto assets using fiat currencies.
Coinbase has two crypto exchange platforms: Coinbase and Coinbase Pro. The regular Coinbase app is an easy-to-use platform suitable for beginner traders, while Coinbase Pro is designed to offer a few advanced features for more experienced traders. Coinbase Pro also offers low fees.
BlockFi vs. Coinbase: unique features
BlockFi features
- Interest bearing account: One of the major draws of BlockFi is the ability to earn rewards on crypto inside BlockFi Interest Accounts (BIAs). Investors can earn up to 9.75% interest, depending on the cryptocurrency. Keep in mind tho that this service is no longer available to U.S. residents.
- Crypto loan: BlockFi offers loans at a competitive interest rate. This attractive BlockFi product has an interest rate as low as 4.5%. The crypto backed loans are available as USD, USDC (US dollar stablecoin), or GUSD (issued by Gemini Trust Company). Also, institutions can leverage the crypto lending platform to borrow U.S. dollars, stablecoins, and cryptocurrencies.
- BlockFi Rewards Credit Card: The BlockFi Rewards Credit Card is a Visa Signature credit card that allows users to earn rewards in Bitcoin, Ethereum, and other crypto assets.
- Personalized yield: High net-worth clients can negotiate crypto interest rates, trading costs, and terms on the BlockFi platform.
Coinbase features
- Coinbase Card: The Coinbase Card is a Visa debit card that allows users to earn rewards when they spend U.S. dollars or any crypto asset in their Coinbase wallet or account. There are no annual fees with the Coinbase Card and users can earn up to 4% back in rewards for any purchases made using the debit card.
- Coinbase Earn: By watching the educational videos on Coinbase, users will learn and be rewarded with a small amount of free crypto for consuming the educational content.
- Coinbase Borrow: Coinbase allows users to borrow up to 40% of their crypto asset value (up to $1,000,000), using Bitcoin as collateral. The funds are paid directly to a bank account or PayPal.
- Price alerts: Using the watch list feature, users on Coinbase have the opportunity to create alerts for price changes on any currency or trading pair they are interested in. Push notifications about price changes are sent to users on their mobile devices.
- Educational content: Users can learn more about cryptocurrencies on the Coinbase website and mobile app to improve their knowledge about crypto.
BlockFi vs. Coinbase: supported countries
BlockFi is available to all traders across the globe, except in countries and states sanctioned by the UK, U.S., or EU. While anyone can access the platform in the United States, some cryptocurrencies are not available in some states.
It's worth mentioning again that the BlockFi Interest Account isn't currently available for U.S. residents. Also, US-based traders can’t access USDT.
Coinbase is available in more than 100 countries, including 49 states of the US. Hawaii residents are not allowed to trade on the platform. Also, certain coins are not available for New York residents.
BlockFi vs. Coinbase: supported cryptocurrencies and Fiat currencies
Coinbase is well ahead of BlockFi when it comes to available crypto coins. Traders can trade over 150 cryptocurrencies on the Coinbase platform. The list includes many popular options, such as Bitcoin, Ethereum, Polkadot, Cardona, Solana, and more.
Investors looking to put their funds in other lesser-known altcoins for possible future growth have plenty of options to choose from on the Coinbase platform. This is in addition to several stablecoins.
Conversely, BlockFi only supports eight cryptocurrencies and stablecoins. These include:
- 1.
- 2.
Ethereum (ETH)
- 3.
Titan Coin (TC)
- 4.
PAX Gold (PAXG)
- 5.
USD Coin (USDC)
- 6.
Tether (USDT)
- 7.
Paxos Standard Token (PAX)
- 8.
Gemini Dollar (GUSD)
Coinbase supports USD, GBP, and EUR, but BlockFi doesn’t support fiat currencies. Investors on the BlockFi exchange can only have their bank transfer or wires converted into the GUSD stablecoin.
BlockFi vs. Coinbase: fee structure
One of the biggest differences between BlockFi and Coinbase are their fee schedules. Here's what you need to know about how both platforms make money:
BlockFi
BlockFi advertises that it doesn’t charge trade fees. And that’s technically true. However, there is a spread of about 1%.
Also, users have to pay a withdrawal fee after using up their one free monthly stablecoin and crypto withdrawal. The withdrawal fee depends on the cryptocurrency you are withdrawing. Also, there are limits on the number of times you can withdraw in a seven-day period.
Once investors have exhausted their one free monthly withdrawal, withdrawal fees are charged as follows:
It is important to note that not all cryptocurrencies are eligible for free monthly withdrawals. You don’t get any free withdrawals with the following crypto coins on BlockFi:
- ETH
- LINK
- PAXG
- UNI
- BAT
Coinbase
The basic Coinbase exchange charges a spread of about 0.50% plus a flat fee for the following transaction amounts:
Coinbase Pro, meanwhile, charges a maker-taker fee of up to 0.60% per trade. Users with higher monthly trade volumes will attract lower fees.
BlockFi vs. Coinbase: mobile apps
Both BlockFi and Coinbase provide mobile apps for Android and iOS devices. Users on both platforms can easily access their accounts to buy and trade any crypto asset.
The mobile apps are pretty straightforward and allow users to perform basic trading operations (buying and selling) on their cell phones. This simplistic design is because both cryptocurrency exchange platforms mostly target beginners. In other words, the mobile apps do not provide any advanced charting or other detailed data on profit and loss.
BlockFi users can access their interest account and even apply for crypto-backed loans right from their mobile phones.
BlockFi vs. Coinbase: security
Both exchanges take security very seriously and meet strict US regulatory standards. All users must pass a verification process.
Gemini Trust Company is the primary custodian of BlockFi. The company keeps a large percentage of investors’ funds and crypto holdings in offline cold storage.
Coinbase stores 98% of deposits in various offline cold storage locations. In addition to this, Coinbase users with U.S. dollar balances are insured in case of any unfortunate incidences.
Pros and cons of BlockFi
Pros
-
Pays interest on crypto holdings: Depending on where you live, you can earn interest rewards simply for having crypto in your BlockFi account.
-
No minimum balance: BlockFi account does not require a minimum balance to set up the account. Plus, you can earn interest rewards, regardless of how much you have in your interest account.
-
Bitcoin rewards as a referral bonus: You can earn crypto rewards by referring others, as long as they fund their interest account with a minimum of $100. The person you refer will also earn crypto rewards.
-
Recurring trades: Crypto investors can set up recurring trades that execute automatically in addition to instant trades.
Cons
-
Interest accounts aren't currently available in the U.S.: U.S. residents with existing accounts will continue to earn interest, but users won't be able to open new accounts until the upcoming BlockFi Yield product launces.
-
Limited number of supported coins: Only eight coins are currently listed on BlockFi. This can be very limiting for crypto traders looking to build a diversified portfolio of coins.
-
Withdrawal fee may apply: For most coins, traders are charged a withdrawal fee after they've used their one free withdrawal for the month. But users are always charged a fee for withdrawing coins that are built on the Ethereum blockchain.
-
Trade spread is on the high side: BlockFi adds a spread of about 1% on trades. That's nearly twice as high as Coinbase's highest taker fee of 0.60%.
Pros and cons of Coinbase
Pros
-
Great choice for beginners: Coinbase has a one-click trading option, making it easy for newbie crypto investors to buy, sell, and trade cryptocurrency.
-
Robust asset list: Coinbase currently supports over 100 cryptocurrencies and stablecoins.
-
Low minimum trading: Users can start buying cryptocurrency for as little as $2 on Coinbase.
-
Insured crypto: While the website boasts robust security, Coinbase takes things a step further by insuring investors' crypto assets in case of unfortunate hacks.
Cons
-
Few advances trading options: Experienced investors and advances users may find the transaction types and charting tools on the trading platform to be limited.
-
No interest accounts: While Coinbase does offer multiple ways to earn crypto rewards (Coinbase Earn, Coinbase Card, staking), it doesn't currently offer interest accounts.
The bottom line
BlockFi and Coinbase are both great crypto platforms with many similar offerings as well as a few distinct differences. Ultimately, your choice will depend primarily on what you want in a crypto trading platform.
Both exchanges are suitable for beginners, but Coinbase provides an additional platform (Coinbase Pro) for crypto investors who want something a bit more advanced. It also provides rich educational resources to help newbie traders understand trading basics. And crypto traders who want a more diversified crypto portfolio will find Coinbase to be a better choice because it has a wider selection of coins.
On the other hand, BlockFi may be a better choice if you're looking for an interest-bearing account. International users can start earning interest on their crypto assets today and U.S. users will soon be able to after the launch of BlockFi Yield.
Continued reading: Best cryptocurrency exchanges
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