Coinbase is one of the largest crypto exchanges headquartered in the USA. It has high liquidity and is easy to use, but Coinbase alternatives offer lower transaction fees and support more crypto and fiat currencies.
Here is a look at four Coinbase alternatives that have advantages and disadvantages. First, we need to summarise what makes a good crypto exchange.
Choosing A Suitable Crypto Exchange
Traders can choose from a host of crypto exchanges on the web or through their mobile devices. They need to consider various aspects before registering on these platforms.
The first aspect is choosing an exchange with the trading pairs you want, for example, fiat-to-crypto (US dollar to Bitcoin) or crypto-to-crypto (Bitcoin to Ethereum).
Next, a trader should compare transaction fees between different exchanges. They should choose an exchange that has a fair fee structure. A trader looking to trade large amounts of crypto should look at exchanges that offer tiered fee structures because the transaction fees would be more fixed.
Furthermore, traders should also look at the maximum transaction cap on the exchange. Many have a limit on the amount they can trade daily or monthly, so they should choose an exchange with a suitable deposit and withdrawal cap.
Most importantly, traders should research if the exchanges have a good track record. They should look at news related to it and monitor previous price movements to assess the volatility and liquidity of the exchange.
Why Choose A Coinbase Alternative?
Coinbase allows traders to use over 25 cryptocurrencies, including Bitcoin, Ethereum, Ripple, and Litecoin. It has a simple user interface aimed at beginners. It also has high liquidity, which minimises the risk of traders losing all their assets due to volatile price movements.
These aspects make Coinbase a valid option for beginner traders, but there are a few disadvantages to using this platform.
Firstly, users pay higher transaction fees on the platform than on other exchanges. Coinbase charges different fees for different payment methods. These range from 1.49% for wallet and bank account transactions to 3,99% for debit and credit card transactions. The transactions also depend on a user’s region and crypto purchase value.
In contrast, if a user opts for Coinbase Pro, transaction fees are as low as 0.04%, and it depends on the crypto value.
Also, users do not have control over their assets on the exchange. Coinbase is a centralised exchange, so the platform controls a user’s crypto assets. Although, a user could withdraw their assets and store them in a hardware wallet for cold storage.
There are many Coinbase alternatives for traders looking to trade with cheaper transaction fees and more freedom when trading with other fiat currencies and a wider variety of altcoins.
Four Coinbase Alternatives
The first Coinbase alternative, Kraken, allows traders to exchange various fiat currencies like the US dollar, the British pound, the Euro, and the Japanese Yen. However, it does not allow transactions from platforms like PayPal, credit cards, and debit cards.
Kraken supports major cryptocurrencies such as Ethereum, Bitcoin, Litecoin, Dogecoin, Ripple, and others. It is one of the largest Euro-crypto markets.
It also has various features that protect a trader’s crypto assets. They operate a dark pool, which allows large market-cap businesses or individuals to make anonymous trades. The dark pool is a private securities exchange that emphasises anonymity. It is a list of trades that are not published to the public.
Also, Kraken has Two-Factor Authentication (2FA) for users to keep their accounts secure.
Kraken has a tiered account verification system. Tier 0 users can only browse the exchange and not make any transactions.
Users must provide their full biographical details (name, country, and phone number) to reach Tier 1. Their withdrawal limit is $2,500 per day and $20,000 per month, but only in cryptocurrencies.
Tier 2 allows users to deposit and withdraw fiat currencies. The transaction limits are $2,000 a day and $10,000 a month. Cryptocurrency transactions have a higher cap at $5,000 daily and $50,000 monthly. Users need to provide their physical address to reach this tier.
Users provide a valid government ID and proof of residence to reach Tier 3. The daily limits are $25,000 for fiat and $50,000 for crypto. The monthly limits for both are $250,000.
Kraken’s major advantages are its security features and its high liquidity. The ability to exchange fiat and cryptocurrencies assists in liquidity. On the other hand, the high level of security means that users must wait a while before trading on the platform.
LocalBitcoins is a peer-to-peer Bitcoin exchange. This means users can trade among themselves using platforms like PayPal or other payment services. Users only need to provide an email address to begin trading.
This exchange charges no fees for buying and selling Bitcoin. It does, however, charge for certain services. Users who advertise Bitcoin for sale are charged a 1% fee on all trades. There is also a service fee of 0.5% for invoicing. The Bitcoin network also has fees that apply to the exchange. Additionally, there is no limit on the number of crypto users that can trade.
LocalBitcoins allows users to set up 2FA on their accounts. The platform also records the IP addresses of account creations and the user’s browser. If they log in from another network or browser, they must verify their account again.
In summary, this exchange is secure and has an attractive fee structure. This helps users find buyers and sellers easier. It also allows users on the platform to see crypto traders in their area.
On the other hand, it is not available in the USA due to regulations. This makes it a good Coinbase alternative for users outside the USA.
Xcoins is available in over 165 countries. It allows buying crypto with the US dollar and Euro fiat currencies. Users can buy crypto with their Visa or Mastercard credit and debit cards. It supports Bitcoin, Ethereum, Litecoin, Ripple, and Bitcoin Cash. It also allows users to lend and borrow crypto.
If a user lends crypto, they can earn interest on their loan. Lenders use US dollars as collateral.
Xcoins’ speed extends to account verification. Additionally, users can get their crypto within 15 minutes after payment approval. Users can have their accounts verified within 15 minutes too.
Xcoins has a built-in wallet, meaning purchased coins are instantly added to the wallet, and users have instant access to their crypto for loans.
Moreover, the exchange sells assets from its liquidity. This means that users have quicker access to crypto for purchase. Also, it allows the exchange to automate its loan system. The system tracks user payments and automatically releases crypto for the borrower. On the downside, Xcoins is a buy-only exchange. Users cannot sell their crypto assets on the platform, only lend.
Another downside is the limited amount of cryptocurrencies available for trade. There is also a 3.9% charge on all debit and credit card transactions on the platform.
Finally, it is the borrowers’ responsibility to get repayments from their lenders. Also, users pay anywhere from 15% to 20% to buy or borrow coins.
Coinmama is an exchange allowing users to buy crypto using any fiat currency with a credit card. It is available in over 190 countries and supports Bitcoin, Litecoin, Bitcoin Cash, Ethereum, Ripple, Ethereum Classic, Qtum, and Cardano.
The exchange is more protected from fraud and other financial crimes. Though it has a limited amount of crypto to purchase, it has an easy-to-use user interface. It is also registered with the Financial Crimes Enforcement Network.
Coinmama has a high spending limit of $5,000 daily and $30,000 monthly. Users need to provide information to Coinmama to increase their spending limit. There are three levels.
At level 1, a user must send a valid government ID to Coinmama. At level 2, the user must send a photograph of them holding a recent bill and their ID card. In level 3, the user must complete a form and send it to Coinmama. Level 3 users can purchase up to $1 million worth of crypto.
The downside of Coinmama is its high transaction fees. A user needs to pay an extra 5% on their card purchases. This is in addition to the transaction fee of Coinmama. The transaction fee is usually around 5.5% for every purchase.
Coinbase alternatives offer lower transaction fees, but credit and debit card purchases incur additional charges on most other exchanges.
These alternatives also serve more countries and regions than Coinbase. Their availability allows traders worldwide to trade, and various other exchanges also offer more variety in payment options.
Finally, if a trader wants to spend less on transaction fees and trade in more regions, there are many Coinbase alternatives in the crypto market.