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BlockFi vs Coinbase: Everything You Need to Know

BlockFi vs Coinbase: Everything You Need to Know
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BlockFi and Coinbase are two of the most popular crypto exchange services. They both offer a variety of features and benefits, so it can be difficult to decide which one to use. In this article, we’ll compare BlockFi vs Coinbase side by side, so you can make an informed decision about which platform is right for you.

BlockFi
5.0

BlockFi offers a crypto interest account (earn up to 8.9% APY), a crypto trading account, crypto rewards credit cards and crypto-backed loans.

Minimum Investment: $1
Accredited Investors Only?: No
Pros:
  • No Monthly Fees
  • No Minimum Investment
  • U.S. Based Company
Cons:
  • No Joint Accounts
  • APY Volatility
  • Not FDIC Insured
Sign Up
Coinbase
4.5

One of the most popular exchanges for cryptocurrency investors. Coinbase offers dozens of currencies including Bitcoin and Ethereum.

Enjoy an easy to use, secure platform to invest and trade cryptocurrencies.

Minimum Investment: $1
Accredited Investors Only?: No
Pros:
  • Available in dozens of countries
  • Easily make deposits and withdrawals
  • Very user-friendly interface
Cons:
  • Fee structure can be difficult to understand
Sign Up

BlockFi Overview

Founded by Zac Prince and Flori Marquez in 2017, BlockFi is a crypto exchange platform that offers a variety of features and benefits. Their crypto can be traded, sold, or bought at competitive prices. You can also take out crypto-backed loans.

How Does It Work? 

BlockFi allows users to collateralize their cryptocurrency holdings to borrow against them. This feature is unique to BlockFi and can benefit traders who want to leverage their positions without selling their assets.

Pros

  • Competitive prices
  • Can collateralize crypto holdings to borrow against them
  • Holistic platform
  • Comprehensive help center
  • Earn interest on cryptocurrencies

Cons 

  • Relatively new company
  • Interface is not friendly to beginners
  • Limited crypto options
Get Up to $250 in Bonus Bitcoin
BlockFi
5.0

BlockFi offers a crypto interest account (earn up to 8.9% APY), a crypto trading account, crypto rewards credit cards and crypto-backed loans.

Minimum Investment: $1
Accredited Investors Only?: No
Pros:
  • No Monthly Fees
  • No Minimum Investment
  • U.S. Based Company
Cons:
  • No Joint Accounts
  • APY Volatility
  • Not FDIC Insured
Sign Up

Coinbase Overview

Coinbase is one of the most popular cryptocurrency exchange platforms out there. It allows users to buy, sell, and store digital assets such as Bitcoin, Ethereum, Litecoin, and more. Coinbase also offers a variety of features and benefits, making it an excellent option for those looking to invest in or trade cryptocurrencies.

How Does It Work? 

Those interested in Coinbase can open an account as long as they are over 18, have access to a smartphone with access to the internet, and have a government-issued photo ID. Banking information is required when signing up as well for payment purposes (buying and selling).

Pros

  • Over 90 types of crypto
  • Highly rated app
  • Potential for free cryptocurrency
  • debit card options

Cons 

  • High fees
  • Complicated fee structure
  • Help Service- no 24/7 support or live chat
Get Paid To Learn About Crypto
Coinbase
4.5

One of the most popular exchanges for cryptocurrency investors. Coinbase offers dozens of currencies including Bitcoin and Ethereum.

Enjoy an easy to use, secure platform to invest and trade cryptocurrencies.

Minimum Investment: $1
Accredited Investors Only?: No
Pros:
  • Available in dozens of countries
  • Easily make deposits and withdrawals
  • Very user-friendly interface
Cons:
  • Fee structure can be difficult to understand
Sign Up

Who Should Use BlockFi vs Coinbase?

Coinbase often attracts beginner users. Coinbase offers educational materials and has easy-to-navigate resources like tutorials and mobile apps. BlockFi, on the other hand, while not un-friendly for first-timers, doesn’t provide the same educational materials and tutorials as Coinbase. BlockFi is better known for its general crypto advice and quality customer service. If you’re someone who values support any time of day, BlockFi is for you. If you would benefit from beginner resources and educational materials, Coinbase is your better option.

BlockFi vs. Coinbase: How Do They Compare?

Features

Coinbase users can purchase crypto in a few different ways, including Paypal, wire transfers, and ACH, whereas BlockFi can send payment via wire transfer or ACH. While Coinbase converts government-backed fiat currency to altcoins, BlockFi converts to Gemini Dollars, also known as GUSD, and places it in a BlockFi Interest Account, or BIA.

Ease of Use — Web and Mobile Apps

Both BlockFi and Coinbase offer mobile apps available on Android and IOS. These apps are crypto novice-friendly. Users can easily sell and buy crypto from the comfort of their phones.

Sign-Up Process

Both BlockFi and Coinbase’s sign-up processes are very straightforward. You need to be over 18, have access to technology and the internet, and provide your personal information. Take a look:

BlockFi- To sign up with BlockFi, you must prove that you are 18 or older using a government-issued picture ID. You will also need to have an active cell phone and provide a real-time selfie.

First, create an account by selecting the “get started” option. Next, you will provide your full name and email, create a password, and agree with BlockFi’s terms and conditions. After that, you will indicate whether this is a personal or business account. For personal accounts, simply verify your email and personal information. You will also need to provide your birthday, source of funds, address/country of residence, and social security number (for US users). For business accounts, you will need to provide the business’s name, industry, type, tax ID, and business owner names and contact information. BlockFi will then screen your records.

Once approved, you are free to add funds from another crypto platform or wallet or externally from a bank account.

Coinbase- To sign up for Coinbase, you must prove that you are 18 or older using a government-issued picture ID. You will also need access to the internet and a phone number to receive texts from Coinbase. It is important to keep your browser up to date to support all features.

To get started, simply go to Coinbase’s website and click on “get started.” You will need to provide personal information such as your name, state of residency, email, and create a password. After adding your personal info, you will be asked to verify your email and add your phone number, occupation, the last four digits of your social security number, birthday, address, and answer a few initial questions. Once you have added all of your info, you are ready to get started.

Customer Support 

Both BlockFi and Coinbase have their pros and cons in this category. BlockFi is noted for its 24/7 support by live chat, phone, and email but doesn’t have the education materials that Coinbase does that beginner investors may value.

On the other hand, Coinbase DOES have educational tutorials, tips, and other resources for Crypto novices but lacks the immediacy and quality of customer service response BlockFi is noted for.

Currencies 

As of March 2022, Coinbase supports over 150 types of cryptocurrencies, while BlockFi supports 20+.

Supported Coins

Some examples of BlockFi supported coins include Bitcoin (BTC), Chainlink (LINK), Ethereum (ETH), PaxGold (PAXG), Litecoin (LTC), Dai (DAI), US Dollar Coin (USDC), Tether (USDT), and Gemini Dollar (GUSD).

Coinbase supports the following coins, but is not limited to Bitcoin (BTC), Ethereum (ETH), Cardano (ADA), Solana (SOL), Polkadot (DOT), USD Coin (USDC), Dogecoin (DOGE), Uniswap (UNI), Litecoin (LTC), Shiba Inu (SHIB), Algorand (ALGO), Stellar Lumens (XLM), Polygon (MATIC), DAI (DAI), and SushiSwap (SUSHI).

Fees

BlockFi fees and Coinbase fees are very different in this category. Simply put, BlockFi has far fewer and lower fees than Coinbase.

BlockFi does not charge any regular maintenance fees but does charge a withdrawal fee. The catch is that BlockFi can charge above the spot index price by up to 1%, making the investment potentially more costly than on other platforms.

Coinbase is more involved when it comes to Fees. They charge a convenience fee, maker-taker fee, and withdrawal fee of 1.49%, as well as fees for how you pay and your location.

Wallets 

BlockFi: AES-256 encryption and allow listing

Coinbase: AES-256 encryption, whitelisting, and multi-signature wallets

Security and Trust

Both BlockFi and Coinbase take extensive measures to protect users’ and their funds. For example, cryptocurrency exchanges require strict standards to be met, and both BlockFi and Coinbase go above and beyond. They both offer security features such as password confirmation, hot wallet, bug bounty programming, KYC, and account verification. They both also utilize primarily cold storage, with a small percentage of funds in hot storage.

Where they differ is how funding in hot storage is protected. BlockFi utilizes Aron for hot storage protection, while Coinbase uses the FDIC to insure balances in cash.

Credit Cards

A BlockFi interest accounts are a major plus. They even offer a rewards Visa Signature credit card that gives users 1.5% on purchases in Bitcoin. Similar to BlockFi, Coinbase offers an interest-earning Visa debit card giving users up to 4% in rewards on purchases. So users with the debit Coinbase card can spend their cryptocurrency anywhere that accepts Visas. Neither BlockFi nor Coinbase’s cards have yearly fees.

Loans

BlockFi provides the opportunity for users to take out business loans and consumer loans. Despite the type of loan, users will be subject to a 2% origination fee. The amount users qualify for is based on LTV (loan to value) ratio as well as collateral. Interest rates range anywhere from 4.5% – 9.75%.

BlockFi vs Coinbase FAQ

Is BlockFi as Safe as Coinbase?

Both BlockFi and Coinbase use many of the same security measures to protect users’ funds and investments.

Is Crypto a Good Investment?

There is no easy answer to this question. Crypto-assets are a new and largely untested asset class, so it is impossible to say definitively whether or not they are a good investment. However, there are some things you can consider that may help you make your decision.

Crypto-assets tend to be volatile, so if you are investing for the short term, you may be taking on more risk than if you were investing in a more traditional asset. However, this volatility also provides the opportunity for greater crypto rewards if the market moves in your favor.

Crypto-assets are also not subject to the same regulations as other investments, so there is a higher degree of risk involved. However, this also means that there is the potential for higher returns, as the same restrictions do not limit crypto-assets.

Ultimately, whether or not investing in crypto-assets is a good idea depends on your individual circumstances and risk tolerance. If you are comfortable with the risks, then it could be a good way to grow your portfolio. However, if you are not comfortable with the risks, then you may want to consider other options.

Which Is Better for Crypto Newbies, BlockFi or Coinbase?

Both BlockFi and Coinbase offer a variety of benefits and features that could be appealing to crypto newbies. However, it ultimately depends on your individual needs and preferences. If you are looking for an easy way to get started with crypto that provides educational resources and tutorials, then Coinbase may be a better option. However, if you are looking for more advanced features, such as interest-earning accounts and loans, then BlockFi may be a better option.

How Do I Withdraw From BlockFi or Coinbase?

BlockFi users will navigate to the wallet section, select your withdrawal, bank transfer (ACH), choose the bank account, provide the amount for the withdrawal, and confirm.

Coinbase users will go to assets, choose their cash balance, enter the amount they wish to withdraw, choose the account the funds will go to, and then select cash out now.

Does BlockFi Work With Coinbase?

Users can have more than one account. If users have both a BlockFi and Coinbase account, they can transfer assets between the two.

Can You Lose Money on BlockFi and Coinbase?

Yes, it is possible to lose money on both BlockFi and Coinbase. Cryptoassets are a new and largely untested asset class, so there is a higher degree of risk involved. However, this also means that there is the potential for higher returns if the market moves in your favor.

What Are Some Alternatives to Coinbase and BlockFi?

Some alternatives to BlockFi and Coinbase are Binance, Kraken, and Gemini. Each exchange offers a variety of benefits and features that may be appealing to users.

How Do BlockFi and Coinbase Make Money?

BlockFi and Coinbase make money by charging fees for their services. BlockFi charges interest on loans, as well as origination and management fees. Coinbase charges transaction fees, as well as monthly subscription fees for its Coinbase Pro and Prime accounts.

Can You Trust BlockFi and Coinbase?

BlockFi and Coinbase are two of the most popular crypto exchange platforms, but they are also relatively new and largely untested. There is no guarantee that either platform will be around for the long term or that your funds will be safe if they do disappear. However, both BlockFi and Coinbase have taken steps to try to build trust with their users, such as by providing educational resources and customer support. Ultimately, whether or not you can trust BlockFi and Coinbase is up to you.

Has Coinbase or BlockFi Been Hacked? 

Yes, both Coinbase and BlockFi have been hacked in the past. In 2012, Coinbase was hacked, and about $250,000 worth of Bitcoin was stolen. In 2022, BlockFi was also hacked vi SIM-swipe but announced that no funds were stolen. However, users’ personal information was compromised. However, it’s important to note that both platforms have strict security measures in place.

Final Verdict—Does BlockFi or Coinbase Come Out on Top?

After comparing BlockFi vs Coinbase, you may have decided which is the best platform for you. So which is best? It ultimately depends on your individual needs and preferences. If you are looking for an easy way to get started with crypto that provides educational resources and tutorials, then Coinbase may be your option. However, if you are looking for more advanced features, such as interest-earning accounts and loans, then BlockFi may be better.

Like features from both? Don’t let that stop you- sign up for both!