For a beginner who is interested in buying and trading cryptocurrencies, there is no shortage of options. Two of the most recommended places where you can buy and trade cryptocurrencies are Coinbase and Gemini, for good reasons. They both are very beginner-friendly. Even so, you also need to know that they are totally different services. While Coinbase is more like a crypto wallet, Gemini is more like a typical exchange where you can trade cryptocurrencies rapidly. For sure, each of them has different pros and cons. Continue reading below for the detailed comparisons of Coinbase vs Gemini!
The first thing that you need to know when choosing between Coinbase vs Gemini is that they are totally different services. Coinbase is like a crypto wallet which facilitates many things to be easier. On the other hand, Gemini is more like a real exchange.
Coinbase is a cryptocurrency exchange, but it acts like a crypto wallet where you can deposit your money to buy select cryptocurrencies (Bitcoin, Bitcoin Cash, Litecoin, and Ethereum). It may be described as a cryptocurrency retail store which provides the simplest ways to buy cryptocurrencies. Whenever you are purchasing or selling cryptocurrencies on Coinbase, you are transacting directly with the company and not the market. See our previous post about Coinbase vs Kraken here!
The Coinbase company is the one that sets the prices. Your orders are immediately executed on those agreed prices, although it may take a few days until you actually receive the cryptocurrencies due to the lengthy process. There is no risk of placing an order that does not get filled, which is an issue when on an exchange. Coinbase does charge some additional fees for the convenience.
On the other hand, Gemini is a real crypto exchange. It operates pretty much like a forex or stock exchange. Here, you can create an account, make a deposit, and trade cryptocurrencies and fiat currencies. Gemini allows you to buy and sell cryptocurrencies rapidly without a lengthy wait time. It has a maker/taker fee schedule which is based on the volume of the user trades.
Transaction Methods and Fees
Due to the nature, Coinbase provides more transaction methods. The available options are very convenient and useful for some users. Coinbase allows you to make deposits via debit and credit cards, bank transfers, and other cryptocurrencies. Meanwhile, for withdrawals, you can use bank transfers or even sell your cryptocurrencies for PayPal funds.
Coinbase charges a fee on each purchase, depending on your payment method. The fee is up to 1.49% if you choose to pay via bank transfer, or up to 3.99% if you choose to pay via debit or credit card. A purchase via a bank transfer may take a few days to complete, but there is a new feature that allows immediate transactions on bank transfers for certain accounts. Purchases via debit/credit cards are completed immediately.
On the other hand, Gemini is quite more limited. It only allows deposits and withdrawals via bank or wire transfers. However, there is one big advantage. The transaction fee is much lower, only about 0.25%. Depending on the circumstances, the significant difference may give you quite more profits from your trades. The transactions are completed immediately.
The next thing to consider when choosing between Coinbase vs Gemini is the available cryptocurrencies. Both of these platforms are generally beginner-friendly, and they only trade the most popular cryptocurrencies.
Nevertheless, Coinbase is slightly better because it does provide more options. On Coinbase, you can trade Bitcoin, Bitcoin Cash, Litecoin, and Ethereum. In addition, it also has the Global Digital Asset Exchange (GDAX) for trading professional digital assets.
On the other hand, Gemini is much more limited. There are just two options here, which are Bitcoin and Ethereum. Even so, Gemini is also one of the most active exchanges which handles lots of transactions daily.
Coinbase does not give a straightforward explanation regarding the purchase limits for new users. But you may want to know that the limits do vary, depending on your account age, account verification, and buying history. Your account’s limits are shown on the verification page. Bank transfer limits seem to be set to $5,000 per week for most users. Debit/credit card limits are apparently set to $60 per week.
On the other hand, Gemini has a clear limit for their bank transfers, which is $500 per day. Both Coinbase and Gemini allow you to deposit larger sums of money via wire transfers, but you’ll need to contact them for this.
Coinbase has good security. The company is trustworthy, based on San Francisco, California, and they have served over 10 million customers. It is one of the largest crypto exchanges in the world.
For sure, the company does separate customer funds from company funds. This is to ensure healthy financial processes. 98% of the crypto funds are stored in cold offline storage. The remaining 2% are online and are fully insured. It is FDIC-insured for up to $250,000.
Coinbase also implements some safety measures on the client side. It now supports two-factor authentication via Google Autheticator, Authy, or SMS. It requires verification whenever a new device attempts to log in. It also has multiple approvers and time-delayed withdrawals through the Coinbase Vault.
Gemini is also a trustworthy company with great security. It is based in New York. It is one of the most well-known crypto exchanges in the world. Similarly, Gemini also separates their customer funds and company funds. The majority of the crypto funds are stored in cold offline storage, but they don’t specify how many crypto funds that they keep in their offline storage. The funds are eligible for FDIC insurance. Finally, Gemini supports two-factor authentication via Authy and SMS.
Customer support is one of the biggest issues that plague many crypto companies. However, both Coinbase and Gemini do pretty well in this aspect.
Both Coinbasevs Gemini are very similar in terms of customer support. They both provide customer support via email. They both generally respond within 24 – 72 hours, which isn’t really bad. They are quite helpful in aiding customers.
|- More like a crypto wallet where you can deposit your money to buy select cryptocurrencies||- A real crypto exchange which operates pretty much like a forex or stock exchange|
|- Deposits via debit/credit cards, bank transfers, and other cryptocurrencies; withdrawals via bank transfers or PayPal||- Deposits and withdrawals via bank or wire transfers|
|- Higher fees||- Much lower fees|
|- Has Bitcoin, Bitcoin Cash, Litecoin, and Ethereum||- Only has Bitcoin and Ethereum|
|- Higher purchase limits, may vary depending on the account||- $500 bank transfer daily limit for individual accounts|
Both are trustworthy and secure companies, and choosing between Coinbase and Gemini comes down to your personal needs and preferences. Coinbase is generally a better choice for beginners due to the ease of use and convenient transaction methods. Coinbase also has more cryptocurrency options and higher purchase limits. However, you may choose Gemini if you want to save as much money as possible from fees and maximize your profits.