Last Updated On November 15th, 2018
The first major hurdle to owning and trading cryptocurrency is choosing a cryptocurrency exchange. There are literally hundreds of platforms available. Picking the best one for your situation can be a real headache. Two of the largest and highest profile exchanges are Binance and Coinbase. Each offers access to numerous coins but with a focus on different user bases. Good news! Use this guide to compare the pros and cons of Binance vs Coinbase and decide which works best for your needs.
- 1 Binance Basics
- 2 Coinbase Basics
- 3 Binance vs Coinbase Features
- 4 And the Winner is…
- 5 Additional Resource
Binance was founded in 2017 and is currently based in Malta. A combination of a favorable fee structure and ease of use allowed it to grow rapidly. In the news, it is currently the largest cryptocurrency exchange in the world with average daily trade volume well over $1,000,000,000.
Binance was set up as a crypto-to-crypto exchange. Instead of listing trading pairs against a fiat currency such as Dollars or Euros, it paired different coins. This allowed sellers to be paired directly with buyers. Creating an account is quick and easy and can be done anonymously. Click here to go to the Binance website.
Coinbase was founded in 2012 by the two-man team of Fred Ehrsam and Brian Armstrong. It was set up as a brokers’ exchange rather than a crypto-to-crypto one. When you buy from Coinbase, you are purchasing it directly from them. They don’t allow any third party sales of crypto on their platform.
Setting up an account takes just minutes but does require identity verification for certain transaction types. Because it works like brokers do, transactions go through quickly and allow you to lock in at a set price. Click here to go to the Coinbase website.
Binance vs Coinbase Features
1. Supported Coins
A great way to look at two cryptocurrency exchanges is to compare how many available coins they have. If you’re planning to do serious trading in a variety of altcoins, you need an exchange that supports that.
Coinbase currently offers:
- Bitcoin Cash
- Ethereum Classic
These are all well-established cryptocurrencies with very high market capitalizations. You can only make purchases on Coinbase using fiat/coin pairs.
Binance currently offers:
Binance offers hundreds of available coins, with more added every week. These include Bitcoin, Litecoin, and Ethereum to name a few. Listing them out here would basically be an article in and of itself. Binance allows you to do direct coin trades. You can trade Bitcoin for Ripple, Dogecoin for Ethereum, Bitcoin for Litecoin, and pretty much any other combination you can think of.
In this category, Binance beats Coinbase hands down.
2. Funding and Fees
Some of the most common questions people have when looking at Binance vs Coinbase relate to account funding and transaction fees. This is also one of the areas that really shows the differences between the two platforms.
Coinbase is arguably easier to fund and work with than Binance. You can use a bank account or major credit card to directly buy coins. Once purchased, you can store them there or transfer them to a different wallet.
Binance originally allowed only crypto-to-crypto transactions. To make a trade, you would need to buy a major coin elsewhere then transfer it to Binance. The most common currencies used for this were Bitcoin, Litecoin, and Ethereum.
Recently announced on the news, Binance has begun setting up a fiat based trading platform as well. Established in Uganda and Malta, this platform allows you to purchase cryptocurrency using fiat currency. Then you can easily move them to your main account.
Binance charges a flat fee of 0.1% for each transaction. If you use their in-house coin, Binance Coin (BNB), you get a 50% discount on top of this.
By comparison, Coinbase charges anywhere from 1.49% to 3.99% based on your country of origin and transaction type.
Binance is the clear winner here. You can find yourself paying as much as 80 times more per trade on Coinbase than on Binance.
3. Functionality and Support
Both Binance and Coinbase have robust platforms with well-designed interfaces and useful features. This really comes down to what you’re looking for in a trading platform.
Coinbase is excellent for crypto beginners. It only allows basic trading of the highest value coins. Its interface is clean, easy to use, and doesn’t overwhelm newbies with information. It also has an iOS and Android app that allows you to access your account on the go.
Customer support is less rosy. The cryptospace isn’t known for being very responsive to user queries but Coinbase is at least trying. They don’t currently have a live chat option but they do allow telephone support calls. You can also email their support team and expect a response within a few days.
Binance was designed to closely resemble traditional forex trading platforms. It can be viewed in either basic or advanced mode. This is mostly just a visual change. Both basic and advanced views include the same information, just presented differently. For advanced users and professional forex traders this is an excellent setup.
For beginners, not so much. There is a distinct information overload effect when starting out with Binance. It’s easy to get lost unless you’re used to reading forex charts like candlestick graphs, real-time sales figures, and market activity indicators.
Though, it can be a great way to deep dive into cryptocurrencies if you’re willing to learn. Binance offers a lot of useful articles, videos, and lessons in their Binance Academy. These include interface lessons and information on cryptocurrency topics in general.
Its apps are even less user-friendly. While Binance does offer IOS and Android apps, it isn’t currently available in the App Store. The app beta version can only be downloaded through a QR code on their website. This is a major barrier for most casual iPhone users.
Binance does even more poorly than Coinbase on support. They have a well-stocked library of support articles and FAQs but few options for direct customer support. They also lack a chat feature and have a generally slower response time to emailed requests.
On the whole, Coinbase beats out Binance here. Their interface is well laid out and intuitive. You can figure it out in a few minutes even if you’ve never traded anything before. Their app is both cleaner and more easily available than Binance’s. Coinbase’s customer support, while still seriously lacking, also gets higher marks than Binance. Overall though, it’s hard to say that either company has really figured out customer service.
One of the most important things to look at when choosing an exchange is security. Look for robust encryption, multi-factor authentication, offline cold storage, and an active response team. It’s also important to know where your money is and how it’s being handled.
Both exchanges currently use AES-256-bit encryption and require multi-factor authentication for account logins. Coinbase and Binance both allow the use of secure two-factor apps like Google Authenticator and Authy. These are significantly more secure than phone-based authentication.
Coinbase is completely transparent about their approach to security. They store 98% of customer assets in offline cold storage. These are kept in a combination of encrypted flash drives and paper records stored in safety deposit boxes around the world. Active trading funds are kept separate from their own brokerage funds to prevent any accidental movement of client funds.
Coinbase has an excellent record within the cryptospace. They haven’t been the victim of any major hacks. When they make a mistake they’ve always worked to correct it as soon as possible.
Binance’s security isn’t as cut and dried. They don’t currently offer any public information about how funds are stored or transferred. They have had incidents before but their security team has actively worked to protect against hackers. The lack of transparency in their practices is worrying for some.
Binance does have a great record of encouraging user security practices. It was stated in the news that they purchased Trust wallet in August of 2018, making them their recommended wallet for users. Their previously mentioned academy has an entire section devoted to security education.
We have to go with Coinbase for this. By all indications, Binance is taking proactive steps to secure their users’ funds. Unfortunately, there simply isn’t enough available information from the company to make a real comparison.
And the Winner is…
In the grand argument of Binance vs Coinbase, the best answer is it depends. Either one is a good choice, especially when compared to the many other cryptocurrency exchanges available today.
Binance is the clear winner for features, analysis and trading fees. It offers much more advanced information and the analytical tools to use it. On a per trade basis, you’ll see significant savings with Binance vs Coinbase. Binance is overall more anonymous than Coinbase. Not a big feature for everyone, but for those who value anonymity, it is very important.
Now that it allows direct purchases with fiat currency, Binance is becoming even more attractive on the market over its competitors. For serious crypto investors who want to frequently trade in cryptocurrency, Binance is absolutely the way to go. Learn more about this crypto exchange in our full Binance review.
That being said, Coinbase is definitely more intuitive. You can create an account, fund it, and make purchases inside an hour. Coinbase is probably your best bet if you’re just looking to buy a few Bitcoin or Ethereum and hold them. The premium you’ll pay in fees is more than made up for by its ease of use. Learn more about this crypto exchange in our full Coinbase review.