Coinbase vs eToro 2022 – Fees, Features, Security Compared – CaptainAltcoin
On first sight, Coinbase and eToro should not have too much in common and won’t be mentioned in the same sentence too often. One is the leading on-ramp into the world of cryptocurrency and the other is a well-known platform for trading different kinds of financial products and derivatives.
But there lies the common denominator: financial assets of all kind are interesting to eToro. Consequently, digital assets like bitcoin and other cryptocurrencies are also subject of interest to eToro that branched out into this new financial vertical in late 2018 and early 2019. And judging by their announced plans and launched products (eToroX exchange and eToro wallet), they are going to play even bigger role in the nascent blockchain industry.
Coinbase needs little introduction: it is THE place, the most popular crypto exchange, where newcomers go to buy their first crypto and enter the magic world of cryptocurrencies.
So, having said all of this, it is a natural sequence of events to compare these two platforms as their paths have crossed already and I have hunch are gonna meet each other ever more frequently in the future.
Bottom line upfront:
eToro is best for regular traders and investors who do not have any particular attachment to the cryptocurrencies per se and don’t care if they own actual coins or not. eToro is a simple, safe and feature-rich way to have exposure to this new asset class. It is also good for thos who want to trade both stocks (traditional stock trading not available in the US) and crypto from one place.
Coinbase is best for newbie crypto users who want access to actual crypto coins and use those currencies on the Ethereum blockchain or on other decentralized exchanges. Coinbase also motivates new investors to learn and earn crypto via their Coinbase Earn, an easy-to-use application, and top-notch security.
eToro vs Coinbase: General info
As we already stated, Coinbase and eToro are not classic cryptocurrency exchanges but rather cryptocurrency brokers that facilitate purchase of crypto. eToro does offer trading as well while Coinbase does that via its Coinbase Pro extension.
|Features||Copy trading portfolios; access to residents of over 140 countries; simple-to-use mobile app, numerous payment methods||Easy-to-use mobile app; buy, sell, and trade crypto; store crypto in Coinbase Wallet|
|Fees||0.75–5% spread fee for buying and selling crypto; no commissions or fees for deposits; $5 withdrawal fee||0.50% per trade; additional 1.49% for bank account or Coinbase Wallet purchases; additional 3.99% for debit or credit card purchases; $10 deposit; $5 withdrawal fee for wire transfers|
|Cryptocurrencies supported||18 cryptocurrencies||50+ cryptocurrencies|
|Security features||2FA via SMS only; cold storage of crypto; USD balances FDIC insured up to $250K; KYC requirements for access; biometric access||2FA via SMS or Google Authenticator app; cold storage and multi-signature wallets; USD balances FDIC insured up to $250K; KYC and anti-money laundering protections|
|Types of transactions||Buy, Sell; limit orders; stop loss; trailer stop loss; take profit trade; margin trading (not available in the U.S.)||Buy, Sell, Exchange, Send, Receive|
Coinbase was launched in 2012 in San Francisco, California. As a company operating in the United States, Coinbase is required to comply with U.S. laws and regulations, including state money transmission laws and regulations, the USA Patriot Act, the Bank Secrecy Act, and is registered with FinCEN as a Money Services Business. These laws and regulations force accountability onto Coinbase. This is something that may be lacking from some of their offshore competitors in other countries with less strict regulations. It is widely considered as one of the best crypto exchanges in the market.
Since its launch in 2006, eToro has become a multinational sensation and is now active in over 140 countries.
eToro is a well established financial and social trading platform offering a wide range of financial trading services. They have expanded their offering to include crypto currencies with some unique benefits such as fee-less trading and margin trading. It is also one of the rare services where you can buy crypto with PayPal. eToro is regulated by the Financial Conduct Authority (FCA), Cyprus Securities and Exchange Commission (CySEC), Markets In Financial Instruments Directive (MiFID), Australian Securities and Investments Commission (ASIC).
One important note: eToro sells you both CFDs or actual coins. With CFDs, it allows you to speculate on their price by giving you IOUs instead of real coin. So in that case, if you want to withdraw bitcoin from eToro, you need to sell it for fiat currency, withdraw that fiat money and go to some other crypto exchange to buy “the real bitcoin”. If you choose to buy actual coins, then same rules of withdrawal apply like with any other exchange.
eToro vs Coinbase Fees
Coinbase charges around 3.99% for credit/debit card purchases and 1.49% for bank transfer purchases.
|Purchase Method||Coinbase Fees|
|U.S. Bank Account||1.49%|
|Coinbase Wallet (U.S. Dollars)||1.49%|
|Credit Card or Debit Card||3.99%|
Although eToro does not charge any trading fees for opening or closing trades, it does charge a spread that varies depending on the instrument, e.g. 0.75% for Bitcoin (BTC) and up to 3.45% for certain trading pairs, such as ZEC/ZHF.
Below is a fee structure of both platforms:
|Wire transfer||Free||$10 deposit, $25 withdrawal|
|Purchases||0.75% to 5%||0% to 0.50%|
|Trades||0.75% to 5%||0.50%|
|Other fees||None||$0.99 to $2.99 based on the amount|
eToro charges a flat $5 withdrawal fee, while deposits are free. Coinbase charges a small withdrawal fee for SEPA withdrawals and a $25 fee for wire transfers.
Coinbase does not clearly define limits for new users on their site. Instead, limits can vary depending on your country, account verification, buying history, and account age. To apply for higher limits you will have to verify your identity. Once you do, a fully verified US residents can transaction up to $50,000 per week, while verified customers from EU may have a maximum of $30,000 in their account at any time. You can check their limits through their account.
There are no upper limits how much you can buy but there is a minimum deposit amount you need to put in on eToro. You must have $200 to participate in CopyTrading and make a minimum investment of $1,000 for CopyPortfolios. The minimum quantities for manual positions are based on the instrument. For currencies (such as cryptocurrencies) and commodities, it is just $25 (or $50 if you are from the US). For stocks, it is $50. Finally, for ETFs and indices, it is $1000.
Coinbase serves customers in the following countries:
Australia, Austria, Belgium, Bulgaria, Canada, Croatia, Cyprus, Czech Republic, Denmark, Finland, Greece, Hungary, Ireland, Italy, Jersey, Latvia, Liechtenstein, Malta, Monaco, Netherlands, Norway, Poland, Portugal, San Marino, Singapore, Slovakia, Slovenia, Spain, Sweden, Switzerland, United Kingdom and the United States.
eToro is available in the majority of the globe, with the exemption of Canada, Cuba, Japan, North Korea, Iran, Syria, Turkey, Serbia, Albania, and Sudan.
Currently, coins listed on its non-Pro interface include Bitcoin, Bitcoin Cash, Ethereum, Ethereum Classic, USD Coin, XRP, Stellar, Zcash, 0x, Litecoin, and the Basic Attention Token.
As a multi-asset brokerage, eToro allows users to trade thousands of financial instruments, including over a dozen crypto currencies (all major coins such as Bitcoin, ETH, XRP, IOTA, EOS, XLM, ADA, EOS etc). Based on the concept of social trading, eToro is designed to be suitable for both new and experienced traders.
Deposit and Withdrawal methods
Coinbase offers 3 payment methods: Debit card, bank account, or wire transfer. In this guide we will cover purchasing with a debit card or with a bank account.
As for withdrawal methods – you have one additional way to get your money from Coinbase by using PayPal.
Among crypto currency platforms, eToro stands out as one of the few platforms that offer users the ability to purchase crypto currencies via PayPal in combination with various other payment options. Other deposit and withdrawal options include: wire transfer (Swift and SEPA), PayPal, Rapid Transfer, iDeal, Klarna/Sofort Banking, Giropay, Skrill, Neteller, Credit Card.
Coinbase customer support is handled through email, and in our personal experiences, we’ve typically received responses from support within 24-72 hours. They also have an extensive FAQ for general questions.
eToro has a thorough help center that provides basic information about trading as well as answers to the most common user problems. In addition, eToro only offers a simple ticket system for the majority of its user complaints and the answers are often slow. Beyond the traditional support lines, eToro also answers customer queries via social media. As a beginner-friendly platform, eToro also offers a variety of training materials and customer support for users, ensuring that help is at hand when it’s needed.
Trust and reputation
Coinbase enjoys an excellent reputation and trust as a registered and regulated company with well-known VCs as investors, transparent team and immaculate track record (with minor, anecdotal complaints from individual customers).
Coinbase is a Bitcoin company based in San Francisco, which means that is required to comply with US laws and regulations, at both a federal and state level. Here are some of the regulatory bodies, laws, and regulations that Coinbase complies with:
- It complies with state money transmission laws and regulations.
- It complies with the USA Patriot Act.
- It complies with the Bank Secrecy Act.
- It is registered with FinCEN as a Money Services Business.
As a regulated platform, eToro is governed by the highest standards of accountability and transparency and is licensed to offer its services to large parts of the world. Currently eToro is regulated by the Cyprus Securities & Exchange Commission (CySEC).
Coinbase or eToro: Security
Coinbase segregates customer funds from company operational funds. These customer funds are held in custodial bank accounts. This means they will not use funds of yours to operate their business. They also claim, “Even if Coinbase were to becomes insolvent, the funds held in the custodial bank accounts could not be claimed by Coinbase or its creditors. The Funds held in those accounts would be returnable to Coinbase’s customers.”
98% of customers’ cryptocurrency funds are stored in secure offline cold storage. These cryptocurrencies are held on multiple hardware wallets and paper wallets. The physical cryptocurrency wallets are then stored in vaults and safety deposit boxes around the world. These measures protect customers’ funds from being lost or stolen by hackers.
The remaining portion of cryptocurrency, that is stored online, is fully insured by a syndicate of Lloyd’s of London.
In terms of cyber-security, EToro platform is extremely safe and never had any issues with hacking attacks or user fund losses. eToro also takes precautions to ensure the funds and personal information of clients are safe. Traditional funds remain secure in European banks of tier 1.
With all that in mind, you should remember that there are no regulations for cryptocurrencies. Because of this, if you engage in cryptocurrency trading or other crypto-related investments, there is no insurance from the investor compensation schemes within the UK or Cyprus. The lack of regulations also means that if you have a complaint, you cannot file it with your financial ombudsman service.
Despite this, eToro takes pride in working to resolve issues as seamlessly as possible. In addition, there are numerous social platforms where you can register complaints, which may influence other users.
Coinbase has seen a rapid growth and branched out into different sectors of cryptocurrency world with most of their new services being geared for institutional clients. Those new services are Coinbase Custody, Coinbase Prime, Coinbase Staking.
Additionally, Coinbase has their Coinbase Pro platform designed for day-traders and their own wallet that is also a Web3.0 browser.
eToro is, as we already mentioned, a comprehensive platform for trading financial products of all kinds. Their crypto division has grown to include eToroX exchange and eToro wallet, two separate products to the main platform of eToro.
eToro’s next generation investment product CopyPortfolio is also a feature not found on any other crypto currency platform. CopyPortfolios allows eToro users to easily invest in top trader portfolios so they can copy the trades of the best traders on the website. eToro users who invest in a CopyPortfolio let eToro manage their capital professionally and avoid the guesswork of trading.
In addition, eToro also offers a unique social feature known as CopyTrading which allows users to automatically copy the trades of other successful traders based on specific conditions.
Currently eToro also offers margin trading.
eToro vs Coinbase: PROS and CONS
- Excellent Reputation
- FDIC Insured
- Easy to Use
- Very Secure
- Accepts Credit / Debit Cards
- Slow Customer Support
- Limited Currencies Available
- Well-Designed Interface
- Trustworthy & Secure
- Variety of Options
- Large range of Markets
- No cryptocurrency deposits
- Not many cryptocurrencies
- Don’t hold the assets
eToro or Coinbase: Conclusion
So who wins the battle between eToro and Coinbase?
- In terms of eToro fees vs Coinbase – eToro is nominally free but they do charge you a spread and earn money that way. Coinbase is charging pretty high fees but not all of those charges go to them but to the third party services you use to fund your Coinbase account (for example Visa and Mastercad). If you plan to trade a lot, eToro is cheaper.
- In terms of supported currencies – almost a complete tie as both have around 15 coins listed on their main platforms. Coinbase Pro and eToroX will have much more coins listed.
- In terms of regulatory compliance and licensing: both are legit and well-regulated companies with a slight edge to Coinbase that has multiple layers of regulatory security.
- In terms of customer support: Both are of similar quality so it is a tie.
- When it comes to security in the eToro vs Coinbase battle: both are top notch so it is another tie.
- Trading features: eToro clearly wins this one as it has more advanced charting interface with margin trading, social trading and other copy trading features.
- Overall reputation: another tie since both enjoy fairly good reputation in crypto community with sporadic complaints by individual customers.
If you are not fond of neither of these exchanges, here is a list of potential alternatives: Cex.io, Binance, Changelly, Bitpanda, Bitfinex, PrimeXBT, PrimeBit, Deribit. Since February 2020, Coinbase Pro has announced they are entering the margin trading arena as well.
In case you want to compare Coinbase with other exchanges, have a look at our guides where we do just that:
CaptainAltcoin’s writers and guest post authors may or may not have a vested interest in any of the mentioned projects and businesses. None of the content on CaptainAltcoin is investment advice nor is it a replacement for advice from a certified financial planner. The views expressed in this article are those of the author and do not necessarily reflect the official policy or position of CaptainAltcoin.com
- 1 eToro vs Coinbase: General info
- 2 eToro vs Coinbase Fees
- 3 Buying Limits
- 4 Supported Countries
- 5 Supported coins
- 6 Deposit and Withdrawal methods
- 7 Customer Support
- 8 Trust and reputation
- 9 Coinbase or eToro: Security
- 10 Other features
- 11 eToro vs Coinbase: PROS and CONS
- 12 eToro or Coinbase: Conclusion