BlockFi vs. Coinbase: Which One Is Right For You?

Posted by Frank Gogol

Cryptocurrency exchanges can also be used as a way to make money through trading an interest. There are many of these exchanges that may be utilized to invest in crypto, among which Coinbase and BlockFi have become very popular.

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But which one should you use for your crypto investments? Which one has the best features? Which one has the better prices and security? Your money is on the line here, so you need to make a smart choice. BlockFi vs Coinbase – let’s see which one suits your needs the most.

The Difference Between BlockFi and Coinbase

At a glance, it seems that Coinbase and BlockFi are quite similar. It may seem that way when it comes to the features, but there are a few differences regarding their fees, investment choices, and crypto products.

What Is BlockFi?

BlockFi is a crypto exchange that was created in 2017 to sell, buy or trade cryptocurrencies. Set up by Flori Marquez and Zac Prince in New Jersey, the platform grew quite a lot in popularity over the past few years. It offers a fair selection of cryptocurrencies that users may invest in, acting like a wallet and a savings account. Rather than just trading the coins, BlockFi acts as an interest account, which allows you to earn on sitting cryptos.

What Is Coinbase?

Coinbase was set up a couple of years earlier than BlockFi, in 2012. Its founders were Fred Ehrsam and Brian Armstrong, with no official headquarters. Coinbase is mostly geared towards active traders and investors, offering a wide range of cryptocurrencies. Users can manage multiple types of accounts, from basic accounts to Coinbase Pro. It gears towards both beginners and advanced traders, depending on the account that they choose.

What’s the Difference?

The crypto selection on Coinbase is much larger compared to BlockFi. BlockFi has less than 12 cryptocurrencies for you to work with, whereas Coinbase has much more for you to handle. At the same time, BlockFi may be the better option for you if you are looking for interest rewards and lower fees.

BlockFi also offers crypto-backed loans, a feature that is similar to Coinbase. However, the difference is in their rates. BlockFi has interest rates that go as low as 4.5% APY. When it comes to Coinbase, the interest rate will go as high as 8% APY.

Coinbase is a little more resourceful as compared to BlockFi. Not only do you have more than 90 assets on Coinbase, but the educational resources are also plenty. BlockFi is there for you to place your trade or investment directly, while Coinbase also acts as a teacher for its users.

Coinbase vs. BlockFi: Features

As determined, both Coinbase and BlockFi offer exchange services, but the approach they take on is slightly different. On Coinbase, an investor may use the Automated Clearing House Network (ACH), debit or credit card, wire transfer, or PayPal in order to purchase and manage cryptos. Coinbase has an 8.6% APY, which is attractive to Investors.

BlockFi has the BlockFi Interest Account (BIA)) that attracts investors. To put it simply, users store their cryptos there, which may be used for crypto-backed loans. The owner of the cryptos will earn interest up to 9.75%, depending on the crypto. BlockFi also has a Rewards Visa Credit Card that earns interest each time you shop with cryptocurrency. Coinbase is considering the option, but nothing is set yet.

Coinbase also has the Coinbase Earn features that users might use. It is an educational feature that teaches its users about cryptocurrency and how to make the right trade. It also differentiates Coinbase from BlockFi, which is rather lacking in terms of education.

BlockFi vs. Coinbase: Currencies

Between the two, Coinbase has the largest selection of cryptocurrencies. Compared to BlockFi, it is far superior, as you can pick from more than 90 coins. BlockFi barely has 12 of them. On Coinbase, you can choose between several cryptocurrencies, including:

  • Ethereum (ETH)
  • Cardano (ADA)
  • Polkadot (DOT)
  • Solana (SOL)
  • Bitcoin (BTC)

Coinbase also has a few stablecoins that were pegged to the U.S. dollar. Aside from the large-scale cryptos, there are also smaller ones that give you more space for growth. This makes Coinbase a good option for everyone, regardless of their budget.

BlockFi also has its fair share of stablecoins. Mostly, it supports the bigger stablecoins that feature the higher interest rates. Here are the ones that you may find on BlockFi:

  • Dai (DAI)
  • Tether (USDT)
  • Binance USD (BUSD)
  • USD Coin (USDC)
  • Gemini Dollar (GUSD)

Aside from the above, there are 7 more coins that you can choose from on BlockFi. The selection is fairly limited. For instance, if you want to make a Polkadot investment, you would not be able to do so with BlockFi.

Coinbase vs. BlockFi: Security

Both platforms are under strict regulatory standards and they use multiple verification methods to ensure it is you. Users may set up two-factor authentication, which both platforms encourage. This will make it much more difficult for a non-authorized person to log into your account.

BlockFi’s custodian is Gemini, which means that the data is placed in Gemini’s cold storage – meaning that it is offline. This puts it out of reach of unauthorized individuals, and even if the platform does get hacked, they won’t be able to get past the barrier of cold storage.

Coinbase uses pretty much the same method: 98% of the funds are kept in cold storage, whereas the other 2% is kept in hot storage. No funds have been reported lost at this point from either platform, but they set up a return policy in case it does happen.

BlockFi vs. Coinbase: Fees

Technically speaking, BlockFi does not charge a transaction fee. That being said, it still charges a 1% margin when the trade price is set. It also charges a withdrawal fee, although you are given one free withdrawal per month. After maxing out your free withdrawal, BlockFi charges the following fees:

  • Ethereum: 0.02 ETH
  • Litecoin: 0.0025 LTC
  • Chainlink: 0.95 LINK
  • Bitcoin: 0.00075 BTC
  • Stablecoins $10.00 USD
  • PAX Gold: 0.015 PAXG
  • Basic Attention Token: 35 BAT
  • Uniswap: 1 UNI

On the other hand, Coinbase does charge transaction fees. In most cases, it depends on the value of the order, along with the payment method. Whether you are using the standard Coinbase platform or Coinbase Pro will also affect the fees.

A variable percentage is somewhere around 1.49%, but this will also depend on the amount that is withdrawn. Overall, here are the transaction fees that you will have to pay on Coinbase:

  • Less than $10: $0.99
  • Between $10 and $25: $1.49
  • Between $25 and $50: $1.99
  • Between $50 and $250: $2.99

Coinbase doesn’t technically charge a withdrawal fee, but it may charge a network fee. The fee will vary based on the crypto that you are withdrawing along with how busy the network is.  

Final Thoughts

Both Coinbase and BlockFi are similar in what they do. The choice depends on what you are looking for in a crypto platform. Coinbase has been around for longer and offers a multitude of features and coins. BlockFi is younger, but it automatically helps you to earn interest and is perfect for beginners. The one you choose is ultimately up to you.


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