If you are wondering if eToro is better than Coinbase, the answer is not always straightforward. Below we compare eToro vs Coinbase, based on a variety of factors.
Coinbase is a cryptocurrency exchange that was founded in San Francisco in 2012 and is currently valued at around $50 billion. Coinbase operates in over 100 countries and has been a good competitor of many reputed brokers, including eToro, which is a multi-asset online broker with a reputation for social and copy trading. Ronen Assia, Yoni Assia, and David Ring established it in 2006. eToro has a big client base of investors and operates in over 140 countries.
Despite their differences in functionality, the platforms overlap when it comes to providing a crypto trading exchange. In this article, we’re holding a detailed comparison between these two brokers and going in depth on their pros and cons, including their features, security measures, and more!
|Regulation||FinCEN||FCA, CySEC, and ASIC|
|Bitcoin (BTC)||Bitcoin (BTC)|
|Bitcoin Cash (BCH)||Bitcoin Cash (BCH)|
|Aave (AAVE)||Ethereum (ETH)|
|Ethereum Classic (ETC)||Ethereum Classic (ETC)|
|Ethereum (ETH)||XRP by Ripple Labs (XRP) (not available in the U.S.)|
|Algorand (ALGO)||Litecoin (LTC)|
|Cosmos (ATOM)||Dogecoin (DOGE)|
|EThe Balancer (BAL)||Dash (DASH)|
|Band Protocol (BAND)||Stellar Lumens (XLM)|
|Basic Attention Token (BAT)||Cardano (ADA)|
|Litecoin (LTC)||IOTA (MIOTA)|
|Bancor Network Token (BNT)||Zcash (ZEC)|
|Bitcoin Satoshi’s Vision (BSV) (Send Only)||NEO (NEO)|
|Celo (CGLD)||EOS (EOS)|
|Compound (COMP)||TRON (TRX)|
|Civic (CVC)||Tezos (XTZ)|
|EOS (EOS)||Chainlink (LINK)|
|Dai (DAI)||Uniswap (UNI)|
|Dash (DASH)||Binance Coin (BNB) (not available in the U.S.)|
|Kyber Network (KNC)|
|Loom Network (LOOM)|
|The Graph (GRT)|
|OMG Network (OMG)|
|Wrapped Bitcoin (WBTC)|
|Stellar Lumens (XLM)|
|USD Coin (USDC)|
|Universal Market Access (UMA)|
Pros: Where Each Broker Stands Out
Most well-known brokers have a thing or two to brag about. We held a comparison between the most prominent advantages of using Coinbase vs. eToro, and here are the results…
In case you are using the exchange’s Pro service tier, you’ll find that Coinbase stands out in terms of commissions. If your monthly trading volume is less than $10,000, you’ll be charged a fee of at least 0.5 percent at the Pro tier. However, with the exchange’s volume-based pricing, you may be able to reduce that fee even further.
The Pro price system is tiered, meaning that the more you trade, the lower your fees become. The amount you pay is determined on your 30-day total dollar trading volume.
Additionally, Coinbase employs a maker-taker pricing mechanism, meaning that adding liquidity to the market or taking liquidity can potentially charge you a different fee.
- Staking Rewards
Traders who own some cryptocurrencies with Coinbase can also participate in staking. Since your holdings are needed to validate transactions in a specific cryptocurrency, staking makes you money, which Coinbase shares with you.
Staking is currently available on just a few cryptocurrencies, including Ethereum. The technical side of things is handled by the exchange, and the extra coins are deposited to your account on a regular basis.
- Crypto Custody
Coinbase is unlike other brokers that primarily focus more on trading. The platform enables users to take custody of their crypto assets themselves. Clients can use the exchange’s own cryptocurrency wallet or bring their own, so they can always choose the one that best suits their situation.
This is unique in the industry, where the majority of conventional brokers won’t let traders hold their own assets on their platform.
- Wide Selection of Cryptocurrency
Coinbase has an impressive selection of cryptocurrencies, with over 50 cryptocurrencies to trade. You can find the most popular crypto like Bitcoin and Ethereum, as well as the least known ones. So, it is easy to find what you are looking for on Coinbase.
Trading restrictions and minimum/maximum withdrawal amounts vary across cryptocurrencies. You may also be limited from exchanging certain coins depending on your state of residence. On Coinbase’s website, you can see a list of these limits for each of the cryptocurrencies it supports.
- Social Trading
eToro created an easily used, highly engaging social trading environment owing to outstanding features like their newsfeed and the ability for users to engage smoothly with one another. As the broker continues to evolve and expand its service, this feature remains an important part of its platform.
- Over 1,000 Assets as CFDs
eToro provides versatile offerings in terms of CFD trading. The broker allows you to trade CFDs in over 1,000 different assets, including Forex pairs, indices, commodities, ETFs, stocks, and cryptocurrencies. This wide selection of markets makes eToro an ideal and highly open option, especially for beginner traders.
Cons: Where Each Broker Could Improve
No broker is 100% perfect, and to know more about the drawbacks, or even potential deal-breakers, that you may encounter while using either Coinbase or eToro, take a look at the comparison below.
- Trading Commissions on Basic Tier
If you can immediately use Coinbase’s Pro tier and skip their basic tier service, that would be great. The following are two common fees from the most recent fee schedule to determine what traders would pay if they bought $1,000 in Bitcoin:
- A spread markup of 0.5%
- If purchasing using a bank account or a Coinbase dollar wallet, there is a 1.49% charge.
You’ll be charged at least 1.99% in fees if you use Coinbase’s entry tier. Because the broker employs a sliding scale, they go up from there. If you want 10$ of Bitcoin, you’ll be charged a fee of $0.99 (9.9%) plus a 0.5% spread markup, for a total of 14.9%.
The effective percentage drops until you spend $200, at which point Coinbase switches to a fee based on the payment method, which starts at 1.49% and rises to 3.99% if you use a debit card. And you’ll have to pay the spread markup as well.
- Lack of Fee Transparency
Traders who use Coinbase’s basic platform will have a hard time seeing a fee schedule before placing a trade. Of course, they will be able to view their trading commission, but only when they’re about to place their trade. And if a broker can’t give a list of trading fees so you can make an informed decision, it’s a major red flag.
- No Hedging or Scalping
Unlike many other brokers, eToro does not allow hedging, scalping, or any other type of algo-trading. So, if you’re a more experienced trader or considering day trading or scalping, you may want to explore another option.
On Coinbase, traders who make a cryptocurrency transaction (such as purchasing Bitcoin or exchanging their Ethereum back into U.S. dollars), will be charged both a Coinbase fee and a spread.
Coinbase’s spread is around 0.50 percent of crypto sales and purchases. However, it varies depending on market conditions. Based on market movements, you may be charged a spread of up to 2.00 percent for cryptocurrency conversions, such as trading Bitcoin for Ethereum. Converting your crypto coins to other cryptocurrencies, on the other hand, does not incur a Coinbase fee.
The Coinbase Fee varies depending on the payment type you use, your region, and other variables. It might be a flat fee or a percentage of your transaction.
|Payment Method (Sale and Purchase)||Fee|
|U.S. Bank Account||1.49%|
|Coinbase USD Wallet||1.49%|
|Instant Card Withdrawal||Up to 1.5% (minimum $0.55)|
|PayPal or Debit Card||3.99%|
|Under or equal to $10||$0.99|
|Higher than $10 but under or equal to $25||$1.49|
|Higher than $25 but under or equal to $50||$1.99|
|Higher than $50 but under or equal to $200||$2.99|
In summary, if a user buys $50 worth of Bitcoin on Coinbase with a bank transfer, they will pay a $0.25 spread plus the $1.99 flat fee (which is more than the 1.49 percent alternative fee). This means that you’ll get around $47.76 worth of Bitcoin out of the total $50 deposit. It doesn’t seem like such a hefty fee, but it does add up when you buy more.
Users can also deposit cash into their Coinbase USD wallet and then purchase cryptocurrency from that wallet later (for the 1.49 percent fee described above). Because prices of crypto fluctuate very quickly, holding USD in your Coinbase wallet might help you avoid potentially long bank transfers (for example, if you want to act immediately to a sudden drop in prices).
Below is a list of fees for depositing USD into Coinbase:
|Wire Transfer||$10 ($25 outgoing)|
Inactivity fee: Coinbase does not charge inactivity fee
On the EUR/USD pair, eToro lists a variable spread of 1 pip (a bit higher than the industry average). Usually, retail traders don’t use this broker for its spreads, but for its social copy-trading platform features.
eToro charges trading fees in the form of spreads, which fluctuate depending on market conditions. It charges a round-turn spread, which means there is just one spread for both buying and selling crypto assets. The majority of bitcoin spreads are between 1.9 and 2.9 percent.
Trading fees on eToro are lower than the usual of the industry. The broker doesn’t charge any fees for US-listed stocks. For stock indexes, the Europe 50 CFD fee is 3%, while the S&P 500 CFD fee is 0.75%. The spread on cryptocurrencies ranges from 0.75-5% (unless trading under Australian Securities & Exchange Commission).
Withdrawals are free for residents of the United States, and there is a $5 withdrawal charge for non-US traders. A fee of 0.5 percent will be charged to transfer crypto from eToro, with a maximum fee of $50 and a minimum fee of $1.
Inactivity fee: If you haven’t logged in for 12 months, eToro will begin to charge you $10 per month as an inactivity fee on any leftover balance.
Features & Accounts: eToro
eToro combines a wide range of trade choices, with sophisticated integration of external crypto wallets in order to appeal to knowledgeable traders. eToro also permits leveraged trading (outside of the United States).
Of course, the well-known CopyTrading feature is what sets this broker apart from the rest. Except in the United States, CopyTrading allows traders to mimic other traders, partaking in the leader’s gains and losses.
Features & Accounts: Coinbase
Although Coinbase has a signaling tool that provides anonymized data on top performers, it is far from the transparent, open platform that eToro provides. The broker is now under investigation for allegedly releasing data without the permission of the top traders who are being tracked. Coinbase Pro clients have been able to trade with leverage on USD quoted books since February 2020.
Simply put, Coinbase has limited trading choices, but it is a growing broker.
Coinbase is authorized to operate in the United Kingdom. It’s worth noting that, despite Coinbase’s FCA-issued e-money licence, cryptocurrencies aren’t protected by the Financial Services Compensation Scheme (FSCS).
Coinbase claims to keep 98% of its users’ crypto in cold storage , while the remaining 2% helps in facilitating trading volume. Additionally, the exchange has an insurance policy that protects cryptocurrency holdings.
Even if your crypto is stolen at some point, there’s no assurance that your money will be returned to your wallet. “However, total losses may exceed insurance recoveries so your funds may still be lost.” Coinbase states on their website.
Two-factor authentication, biometric logins (Face ID and fingerprint), and data encryption are among the security measures Coinbase offers.
However, losses resulting from unauthorized access to your account are also not covered by the insurance policy. Thus, if your identity is stolen or someone discovers your Coinbase password and takes your wallet, the odds to recover it are against you.
eToro complies with FCA, CySEC, and ASIC guidelines, which means it has measures in place to protect traders. Client funds are kept safe in tier 1 banks on eToro, and all personal information is protected by SSL encryption.
Negative balance protection is another protective measure in place, which implies you can’t lose more money than you have in your account. If you reach a point where you can no longer fund your position, the broker will generally close it automatically. As a result, your account balance will never go below $0.
Customer Support: Coinbase
With over 35 million customers on its books, you’d think Coinbase would provide excellent customer service. However, when it comes to customer support, the platform is not the best at all. Many users complain that it’s difficult to reach the team and that they haven’t been compensated for their losses because Coinbase’s customer support is largely handled via email.
Coinbase offers old school email and phone support. You’ll find it difficult to communicate with an agent in real time. There is also a live chat option, but it is managed by a bot. As a result, you will receive only automated responses from a bot that can’t handle many complex scenarios.
Customer Support: eToro
Unlike coinbase, eToro provides decent customer support, but it doesn’t mean it’s perfect. Although eToro’s customer support is not the best, it is adequate for dealing with simple problems.
A live chat option is available in the support centre. but it is tucked away in the FAQ section. Traders have complained that the team is overworked and cannot be reached on weekends.
Because this broker relies on support requests received through the trading interface, there is no phone or email support. Each user’s email inbox receives a response to these tickets. The response time is quick (usually within 24 hours).
Some clients report that the customer support of eToro is not responsive enough, so definitely keep that in mind.
Which One Is Right For You?
Coinbase is a good place to start investing in bitcoin due to its simple interface and instructional resources. If you’re only seeking to invest a small amount of money in Bitcoin as a long-term investment, Coinbase makes your life pretty easy. Just purchase your coins, store them on Coinbase, and monitor their value over time. It is, however, a handy choice for you as you develop as a crypto trader.
With a wide variety of cryptocurrencies you can trade with, Coinbase doesn’t lack too many key features you’d find elsewhere. If you decide to invest in something other than Bitcoin, Coinbase is still a good place to start.
But if you’re going to trade on Coinbase, be mindful of its hefty fees, which are a major disadvantage of using this broker. But for the majority of general investors, this is not a huge price to pay for the vast range of features, convenience, and ‘security’ they get in return.
On the other hand, eToro is a zero-commission stock broker that is regulated and generally regarded as safe. It has a user-friendly platform and a great mobile trading app. eToro allows you to invest in stocks, forex pairs, ETFs, and CFDs.
eToro has an easy-to-use platform with 26 different languages available. More than 70 technical indicators are included in charting tools. It’s a wonderful broker for inexperienced traders who need a little extra guidance. However, because of the large spread and limited maximum trade size, it is not the ideal for active or high-volume traders.
eToro’s social trading platform is an appealing proposition for cryptocurrency investors who like to mimic the behavior of serious crypto traders. eToro provides a better range of cryptocurrencies to purchase and trade than some other brokers in the US.
You can enjoy social trading on eToro as well, but since it is an open social platform, anybody, including non-experts, can give their opinions.
The bottom line is, beginners should go more with Coinbase, while eToro will suit more educated traders seeking a richer trading experience.