If you’re new to the world of cryptocurrency and looking to start your trading journey, two popular platforms that you’ve likely come across are eToro and Coinbase.
Both platforms offer a user-friendly experience and several cryptocurrencies to choose from. But which one is the better choice for beginner investors?
Check out my detailed eToro vs Coinbase comparison below, which compares both platforms and reveals the better option for you.
Let’s start with some background information on eToro and Coinbase.
Table of Contents
Introduction to eToro & Coinbase
eToro is an online investment and cryptocurrency exchange platform that allows users to invest in various assets and cryptocurrencies.
The platform doubles up as a social network where beginners can interact with each other and learn from advanced investors.
Coinbase, on the other hand, is a very popular cryptocurrency exchange. It provides a user-friendly interface for buying, selling, and storing cryptocurrencies like Ethereum and Bitcoin.
Now that we have a clear picture of the two crypto exchange platforms let’s dive into a detailed comparison of eToro and Coinbase to help you make an informed decision.
When it comes to the number and variety of cryptocurrencies available, eToro and Coinbase have their unique offerings.
What Cryptocurrencies Can You Trade On eToro & Coinbase?
eToro prides itself on being a trading platform that caters to the needs of its investors.
The platform allows users to trade over 120 cryptocurrencies, including Bitcoin, Ethereum, Stella, Tron, and XRP.
The vast options in eToro make it a great choice if you want to diversify your portfolio and explore less popular cryptocurrencies.
On Coinbase, you can trade popular cryptocurrencies like Bitcoin, Ethereum, Litecoin, and Ripple.
Since Coinbase primarily focuses on well-established cryptocurrencies, it offers a narrower selection of digital assets than eToro.
Both eToro and Coinbase offer various trading options, although there are major differences between the two platforms.
- Stocks: Investors on eToro can trade stocks from companies listed on major stock exchanges. Once you join the platform, you can buy and sell your stocks and stand a chance to earn profits from price fluctuations.
- Several Cryptocurrencies: The platform offers traders several cryptocurrencies where users can buy and sell crypto depending on the market price.
- Commodities: On eToro, you can also trade commodities like natural gas, oil, silver, and gold.
- ETFs: eToro also offers Exchange-Traded Funds (ETFs). These are investment funds that are traded on the stock exchange.
- Cryptocurrencies: Coinbase focuses on cryptocurrencies as the primary trading option.
- Coinbase Pro: If you’re an experienced trader, Coinbase has an advanced trading platform called Coinbase Pro. You can access real-time marker data from their trading bots through this platform.
Security & Regulation
As an investor, I know that when it comes to choosing the best crypto exchange UK, security is the one thing that you should not overlook.
Luckily, both eToro and Coinbase have implemented measures to protect their users.
Are Both Platforms Regulated by Financial Authorities?
eToro is regulated by several financial authorities, such as the Cyprus Securities and Exchange Commission, the Financial Conduct Authority in the UK, the Australian Securities and Investments Commission, and the Seychelles Financial Services Authority.
On the other hand, Coinbase is registered by Financial Crimes Enforcement Network (FinCEN) in the United States.
Moreover, Coinbase has legal licences such as the BitLicense from the New York State Department of Financial Services that permit it to operate in nearly all US states.
As an investor, these regulations from both platforms can give you peace of mind that your money and investments are in safe hands.
How Do eToro & Coinbase Protect Users Against Fraud?
Both eToro and Coinbase take user data protection seriously.
Here’s how each platform safeguards against hacking and fraud.
- Secure Website: eToro’s website is famous for its Secure Socket Layer encryption that ensures all communication and data are encrypted and protected from interception from unauthorised users.
- Two-Factor Authentication (2FA): 2FA is a security measure where users provide an additional verification code besides their password to log into their accounts. This code is normally generated by a mobile app. eToro provides this security measure to all its users.
- Secure Wallets: eToro stores its users’ cryptocurrencies in secure wallets that meet industry standards.
- Cold Storage: Cold storage is a security measure where users’ cryptocurrencies are stored offline and can’t be directly accessed from the internet. Coinbase uses this approach to reduce the risk of online hacks.
- Two-Factor Authentication (2FA): Just like eToro, Coinbase also supports 2FA for user accounts, where you’ll be required to input your password plus a secure verification code.
- Insurance Coverage: Lastly, Coinbase offers insurance coverage that protects its users. The policy covers losses caused by cybersecurity, employee theft, and breach of their physical security. However, the insurance doesn’t cover losses from unauthorised access to your account. Remember to set up your 2FA from their mobile app to prevent your account from being hacked.
Fees & Pricing Structure
Understanding the fee structure of eToro vs Coinbase will help you determine which platform best suits your needs.
What Are the Fee Structures on eToro & Coinbase?
When it comes to pricing structure, eToro uses a simple and transparent spread-based fee model of only 1%.
This means that as a user, you won’t have to deal with complex commission feeds.
Instead, you’ll only pay 1% of the difference between the buy bid and the sell price.
This straightforward approach helps investors understand that there are no hidden costs to worry about.
This fee structure also makes eToro a great choice for you if you get overwhelmed calculating multiple fees associated with trading.
On the other hand, I found Coinbase’s fee structure a bit more complicated since it considers both payment options and regions.
This complexity can make it hard for new traders. You can read more about their fees here.
What Transactions Do eToro & Coinbase Charge?
Here’s a clear outline of how eToro and Coinbase charge for transactions such as deposits, withdrawals, and account maintenance:
- Deposits: Users can deposit any amount at eToro for free.
- Withdrawals: When you want to withdraw money from your eToro account, you’ll be charged a withdrawal fee of $5 per transaction. Moreover, the minimum amount you can withdraw per transaction is $30. If you subscribe to their platinum and diamond club membership, you’ll be exempted from these withdrawal fees.
- Account Inactivity: If your eToro account is inactive for 12 months, eToro will charge you an inactivity fee of $10 per month.
- Deposits: Just like eToro, Coinbase also does not charge for cryptocurrency deposits.
- Withdrawals: Coinbase’s withdrawal process is a bit more complex. If you wish to convert and withdraw your crypto, you’ll be charged a 1% fee plus the standard network fees.
- Account Inactivity: Coinbase doesn’t charge users an account inactivity fee.
Whether you prefer paying with your credit card or digital wallet, eToro, and Coinbase, offer several options that cater to your needs.
What Payment Methods Are Accepted on eToro & Coinbase?
On eToro, you can fund your account using a UK credit/debit card, bank transfers, Skrill, and Neteller.
Coinbase, on the other hand, prioritises wire transfers, PayPal, and debit card transactions.
Do Both Platforms Support Fiat-to-Crypto Transactions?
A fiat-to-crypto transaction is a feature that lets you convert your traditional currency, like EUR or USD, into cryptocurrencies.
On the other hand, crypto-to-fiat is the reverse process where you can convert your crypto back to your traditional currency.
Luckily, both eToro and Coinbase offer these transaction features to their users.
User Experience & Interface
If you’re a beginner investor, you know that a user-friendly platform can make or break your trading experience.
How User-Friendly Are the eToro & Coinbase Platforms for Beginners?
Both eToro and Coinbase have an intuitive interface that is great for non-tech savvy and beginner investors.
eToro offers a user-friendly interface with a clean and modern design.
Coinbase also has a beginner-friendly interface that simplifies the buying and selling process for new investors.
What Features & Tools Do eToro and Coinbase Offer to Enhance the Trading Experience?
The trading experience can be a challenge to a new investor. That’s why eToro and Coinbase provide tools to simplify this process.
eToro launched its trading academy called eToro Academy, where you can learn different trading strategies and how to accurately analyse the market and make informed decisions.
eToro also has a CopyTrader feature where beginners can follow and learn from experienced traders.
Meanwhile, Coinbase also offers tools to enhance the trading experience.
This includes educational resources such as videos and articles.
The platform also has a Coinbase Earn program where you can earn cryptocurrencies once you complete an educational task.
Lastly, Coinbase also offers real-time price alerts and portfolio tracking where you can monitor your trading performance.
Mobile Apps & Accessibility
In today’s fast-paced world, you need to access your investments from wherever you are.
Both eToro and Coinbase recognise this need and provide mobile apps that allow users to stay updated with market trends and trade from wherever they are.
Are There Mobile Apps Available for eToro & Coinbase?
eToro offers an investment mobile app for iOS and Android, allowing you to trade and monitor your portfolio from your phone.
On the other hand, Coinbase also provides a user-friendly mobile app for managing your investments. Its app is compatible with different smartphone operating systems and informs users about the latest market news.
However, some users experience ID verification issues on the app, so I suggest you do more research before choosing Coinbase.
Customer Support & Resources
eToro offers support options such as live chat, email, and an extensive knowledge base.
Coinbase also provides a good customer system in the form of a help centre and FAQs that provide answers to common questions.
How Responsive Is eToro vs Coinbase in Resolving Customer Issues?
eToro’s customer support and helpdesk are available 24 hours a day, from Monday to Friday. Meanwhile, Coinbase’s support team is only available during limited hours on weekdays (Monday to Friday).
Pros & Cons of eToro & Coinbase
Although both these platforms are great options, they have their fair share of advantages and setbacks.
As we wrap up this head-to-head comparison, here is a summary of the pros and cons of each platform.
To sum it up, here are the advantages of using eToro:
- Social Trading: One of the most unique features of eToro is that it’s also a social trading platform where as a beginner, you can learn and copy experienced and successful traders.
- Cryptocurrency Selection: eToro offers several cryptocurrency options, which are great for experienced traders looking to diversify their trading capabilities.
- Several Assets: As an investor on eToro, you have access to a wide range of assets, including stocks, cryptocurrencies, and commodities. This can help you diversify your investment options.
- User-Friendly Interface: eToro’s platform is famous for its simple design, which is great for beginners and expert traders.
- Regulatory Compliance: As we mentioned before, eToro is regulated by reputable financial authorities and complies with their regulations that protect your data.
- Smart Portfolios: eToro offers pre-constructed portfolios called Smart Portfolios, which allow users to invest in a diversified group of assets based on a particular strategy or theme.
Here are the drawbacks of eToro:
- Account inactivity fees: If you don’t trade or do any other transaction on your account for 12 months, you’ll be charged an inactivity fee. This can be a setback for investors who need to step back from trading to re-strategise.
- Withdrawal fees: Although the $5 withdrawal fee is not very high, it’s higher than the rate of most cryptocurrency exchange platforms.
Here are the advantages of using Coinbase:
- Trusted and Established Platform: Coinbase is among the world’s most trusted and well-established cryptocurrency exchange platforms with a strong track record.
- Insurance Coverage: Coinbase has insurance coverage to protect digital currency holdings, providing an added layer of security.
- Coinbase Pro: The platform has a Coinbase Pro account that is great for experienced traders. The account has an advanced trading platform and lower trading fees than the normal one.
- User-Friendly Experience: Coinbase’s platform is very user-friendly, and beginners can easily store, buy and sell their cryptos.
Here are the drawbacks of Coinbase:
- Limited Asset Selection: Coinbase focuses on cryptocurrencies and offers fewer asset selections than eToro.
- Higher Fees for Some Services: It’s not a secret that Coinbase fees are higher compared to those of other smaller platforms. This makes Coinbase less suitable for traders with a tight budget.
- Average Customer Support: Since Coinbase has a large client base in the UK and worldwide, some users experience delays during peak times of high demand.
Alternatives to eToro & Coinbase
If you’re interested in exploring other options besides eToro and Coinbase, here are some great choices:
- Uphold: This crypto exchange platform enables investors to hold, sell and buy cryptocurrencies. One of the highlights of Uphold is its multi-currency wallet feature, where users can hold different cryptos in the same digital wallet. The downside of Uphold is its high spread fees for some cryptocurrencies. Read my Uphold review.
- Kraken: Just like Coinbase, Kraken provides a secure platform for users to manage their digital assets and cryptocurrencies. One of the highlights of Kraken is its low fees. UK investors can deposit on the platform completely free, and USA investors pay a small fee. The downside of Kraken is it’s not available in all U.S. states. Read my Kraken review.
- Bitstamp: This crypto exchange platform is famous for its user-friendly interface that promotes efficient cryptocurrency transactions. One of the highlights of Bitstamp is its strong security. The platform protects against hacking by storing users’ assets in cold wallets. The downside of Bitstamp is it doesn’t support as many cryptocurrencies as eToro.
eToro vs Coinbase – Final Thoughts
Choosing between eToro and Coinbase will depend on your trading needs and preferences.
All things considered, I believe that eToro is the best option for beginners due to its demo account, affordability, and vast network of experienced traders that you can learn from.
As you embark on this journey, I would advise you to start with an amount you’re comfortable with. Happy trading!
With all things considered, I believe eToro is an excellent trading platform and the best alternative to Coinbase.
eToro is a multi-asset platform which offers both investing in stocks and cryptoassets, as well as trading CFDs.
Please note that CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.
Past performance is not an indication of future results. Trading history presented is less than 5 complete years and may not suffice as basis for investment decision.
Copy trading is a portfolio management service, provided by eToro (Europe) Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission.
Cryptoassets are highly volatile and unregulated in the UK. No consumer protection. Tax on profits may apply.
eToro USA LLC does not offer CFDs and makes no representation and assumes no liability as to the accuracy or completeness of the content of this publication, which has been prepared by our partner utilizing publicly available non-entity specific information about eToro.