Coinbase vs Bitfinex

You can compare and contrast all the important features of your preferred cryptocurrency exchanges with the help of this in-depth Coinbase vs Bitfinex comparison review. Quickly get the answers to any questions you might have regarding any of these two prominent cryptocurrency exchanges by looking at the sections of the article that follows.

About the Exchanges

Coinbase

Coinbase, situated in the United States but accessible worldwide, is a prominent cryptocurrency exchange that can help you get a head start in the cryptocurrency market. 

This prominent cryptocurrency exchange started as a crypto business in 2012 with the groundbreaking idea that everyone, no matter where they were located on the planet, should be capable of sending and receiving crypto in a way that was easy and risk-free. 

Since then, it has become one of the most widely used cryptocurrency exchanges, especially among crypto beginners. 

Moreover, Coinbase is a high-volume crypto exchange that shields its users from sudden market value swings by providing constant and high liquidity.

On Coinbase, you can select between two different exchanges. For those just starting out in the cryptocurrency world, Coinbase’s basic platform is a great choice because of its user-friendly interface and the speed and simplicity with which users can make coin swaps.

Further trading capabilities, such as analytical graphing of price movements, advanced market orders, and margin trading at discounted pricing, are all accessible through the Coinbase Pro interface, which is designed specifically for professional traders.

Bitfinex

Bitfinex is a Hong Kong-based cryptocurrency exchange regarded as one of the most prominent trading platforms in terms of recognition and the number of conducted trades. Designed in France, this marketplace presents a premium destination for experienced traders from all over the world. 

To continue, Bitfinex provides access to a wide variety of advanced trading tools, but its user interface, including its dashboards and menus, is quite straightforward.

As a matter of fact, Bitfinex makes it possible for crypto enthusiasts, businesses, and institutions to put into action well-planned and comprehensive investment strategies thanks to the wide trading tool offering and top-tier security measures it employs.

Pros and Cons

Coinbase Pros

• Trading platform that is easy to use for both novice and seasoned investors;
• Offers high levels of liquidity and low trading costs;
• Provides an option to make recurring purchases;
• Allows for trading on margin;
• Features an over-the-counter (OTC) trading desk;
• It’s the first crypto exchange listed on the Nasdaq stock exchange under the ticker symbol COIN;
• Keeps 98% of consumers’ funds in cold storage.

Coinbase Cons

• No free deposits;
• Rather high trading fees;
• Experienced several security breaches;
• Only professional traders get a fee discount through Coinbase Pro. 

Bitfinex Pros

• Aimed at more advanced crypto investors;
• Offers margin-trading;
• Offering over 200 currency pairings; 
• Provides a suite of cutting-edge trading tools.

Bitfinex Cons

• A rather time-consuming verification process;
• Rather complex for those just getting started with crypto;
• Suffered several hacking incidents.

Coinbase vs Bitfinex: The Crypto Exchange Comparison 

Opening an Account

Establishing a verified account with Coinbase is a prerequisite before trading. The minimum age to create a trading account on this market is 18. 

Next, you’ll have to prove who you are by going through the KYC protocol (Know Your Customer). You’ll be asked to submit identifying information and documents, such as a government-issued picture ID, including your current photo, full name, full surname, and date of birth, as well as a verified phone number and email address. 

In addition to that, you will be required to verify both your address and place of residence.

To complete the user verification procedure, you will also be asked to provide information about your income, employer, and employment location. Upon completing this registration procedure, you will be prompted to select a payment method and activate the two-factor authentication protocol (2FA) for extra security.

To start trading on the Bitfinex platform, users must first sign up for one of the many available account types.  Bitfinex offers several different account options, including those for individual traders, paper trading accounts, and institutional investors.

Upon account creation, you’ll be prompted to submit more personal data and supporting documents to enable two-factor authentication (2FA) and finish the Know-Your-Customer (KYC) authentication.

Main Features

Coinbase

Coinbase is one of the most streamlined trading platforms in the cryptocurrency trading ecosphere. As its name implies, Coinbase is a great starting base for new traders to get their feet wet in the crypto-coin market, thanks to its simple and user-friendly interface. 

CoinSpot’s creators set out to make cryptocurrencies more accessible to traders of all stripes. As a result, the cryptocurrency exchange provides the Coinbase Pro platform featuring more sophisticated trading tools, such as an over-the-counter (OTC) trading desk for institutional investors who transact crypto in larger amounts. 

Expert investors can also use this advanced platform to trade cryptocurrencies using various cutting-edge features, including margin and spot trading.

In addition, there’s the Coinbase Earn feature, which lets you make some extra money while learning about cryptocurrencies in a lighthearted and engaging way, just by watching a video and then taking a short quiz.

Bitfinex

Each Bitfinex user can personalize their interface by picking a desktop layout from a selection of options and modifying the frequency and volume of system alerts.

Those who use Bitfinex as their primary trading platform will have access to a wide range of innovative financial tools, such as OTC for high-volume trading, margin trading, cryptocurrency exchanges, financial derivatives trading, paper trading, crypto loans, capital markets, staking, and advanced order types, to name a few.

Supported Cryptocurrencies

Coinbase is a true goldmine of alternative cryptocurrencies, making it an attractive option for traders who get a thrill out of many trading opportunities. This platform supports over 300 different digital currencies. 

This gives you the opportunity to look for the most tradable digital currencies, such as Bitcoin (BTC) or Ethereum (ETH), stablecoins, or some newly launched or low-cap token, which will allow you to gain a market share with a smaller investment and still get what you’re after.

Bitfinex, on the other hand, is a marketplace where you can trade more than 200 different cryptocurrencies. Some examples of these digital currencies are Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Monero (XMR), Iota (IOTA), Litecoin (LTC), Tether (USDT), Tron (TRX), Ripple (XRP), to name a few.

Payment Methods

Coinbase gives its customers various options to choose from when it comes to making payments. In addition to bank transfers, PayPal, wire transfers, Apple Pay, and Google Pay, Coinbase supports direct deposits from your bank account.

More importantly, you can use your digital money to finance your Coinbase account. However, remember that your present location will determine the payment methods and financial products available to you through Coinbase.

As a Bitfinex customer, you have several options for purchasing cryptocurrencies, including using your account balance to make an exchange trade. Alternatively, you can make use of a credit or debit card to purchase cryptocurrency online.

To this end, Bifinex accepts credit cards issued by MasterCard, Visa, and UnionPay. For your information, Simplex, OWNR, and Mercuryo are not directly affiliated with Bitfinex in any way, but they’re the ones that complete the final steps of employing a credit card on Bitfinex.

Trading Fees and Limits

Coinbase Fees

Coinbase’s transaction fees are calculated as a proportion of the total amount of the trade and fluctuate in accordance with the scope of the business transaction. With this approach, the transaction fees associated with employing Coinbase might range anywhere from $0.99 to $2.99, depending on the particulars of the deal being conducted.

When you use Coinbase, in addition to these set trading costs, you will also be subject to an additional charge known as a spread. Coinbase’s market spread has the potential to go as high as 2% in some circumstances. 

Also, as a result of the narrow gap between the purchase and sell prices on Coinbase, the exchange can provisionally freeze the value of a cryptocurrency asset until you finish the transaction.

One thing you should be aware of regarding the Coinbase expenses is that the deposit fee is 10 USD, while the withdrawal fee is 25 USD. Together, these fees can add a significant amount to the total cost of trading, so be mindful of them.

Bitfinex Fees

When you want to make purchases, sells, or trades using the Bitfinex cryptocurrency exchange platform, you first need to fund your trading account.

You have the option of topping off your Bitfinex account with fiat currencies such as Euros, United States Dollars, Japanese Yen, Great Britain Pounds, or Chinese Yuan, or with any of the digital currencies included on the extensive list of available cryptos.

If you wish to complete the transaction with a fast-track wire transfer, the Bitfinex deposit fee is currently set at 1% of the total amount paid to or received from your account over the prior 24 hours. When it comes to withdrawals, it is the responsibility of the Bitfinex user to pay the various service fees associated with withdrawing crypto.

According to Bitfinex’s maker/taker fee schedule, liquidity takers have assessed a fee of around 0.2% of the deal, slightly higher than the fee of approximately 0.1% imposed on market makers.

In addition, Bitfinex has a minimum withdrawal threshold of $5 in cryptocurrencies. This is the smallest amount that you can withdraw without the system processing it as “crypto-dust,” i.e., cryptocurrency too tiny to be used for any investment.

How Safe Are Coinbase and Bitfinex?

Coinbase Security

Coinbase complies with all applicable financial standards as a licensed Money Services Company (MSB) with FinCEN. Also noteworthy is the fact that this cryptocurrency exchange is the first of its kind to be publicly traded on NASDAQ, the world’s largest stock exchange.

Furthermore, Coinbase employs a wide array of security procedures and methods to ensure that your cryptocurrencies are kept safe. As a first step, Coinbase ensures the safety of 99% of its clients’ cryptocurrency holdings by storing them in a secure cold storage facility covered by a comprehensive insurance contract.

Coinbase users are also prompted to enable two-factor authentication (2FA) and input a passcode texted to their mobile device in addition to their usual login information and password to secure their accounts from unauthorized access.

However, the platform was targeted by several fishing and hacking attempts despite all the precautions taken to protect it.

In the event that something of this nature were to happen to you, you should be aware that the FDIC insures the balances of Coinbase clients up to a maximum of $250,000 per customer, for a total net worth of $500,000.

Bitfinex Security

Bitfinex stores nearly all user cash (99.5%) in an offline multi-signature wallet that needs the permission of all transactions from geographically dispersed management team members using hardware security modules (HSMs).

On top of that, only about 0.5% of the total money is ever stored in the Bitfinex hot wallet’s withdrawal backlog. Only when four of the seven HSMs agree to launch a transfer from the cold storage to Bitfinex’s hot wallet will the hot wallet be refilled, which further guarantees the safety of the funds.

The exchange also meets the AML and CTF regulatory requirements, making it a safe place to do business. Bitfinex applies the Know Your Customer (KYC) requirements, too, with additional safeguards throughout the account authentication process.

Yet, the road that Bitfinex has traveled as a renewed cryptocurrency exchange has not been without its share of bumps and bruises. Specifically, the cryptocurrency exchange was subject to two cyberattacks in its early days, multiple scandals involving price rigging and security vulnerabilities, and insolvency charges. After experiencing repeated hacking attempts, Bitfinex implemented many security measures to protect its network.

However, thanks to its innovative features and stringent security protocols, Bitfinex managed to rise to prominence as one of the major cryptocurrency trading platforms. Protection from Distributed Denial-of-Service (DDoS) attacks, two-factor authentication (2FA), email encryption, and more are just some of the advanced security features built into the Bitfinex platform.

Customer Support

Coinbase offers multiple options for clients to contact customer service, including a phone number, a chatbot, and an email. After that, you will be asked to open a ticket using the email address associated with your Coinbase trading account. 

There is no doubt at all that the people who work in customer service at Coinbase will answer your question as soon as possible.

Since Coinbase is one of the busiest exchanges on the globe, the amount of time it will take for you to receive a response will be determined by how urgent your query is and whether the support team that deals with similar issues is available right away.

Bitfinex, like Coinbase, features a comprehensive help center to address any questions or concerns you may have when using the service. You are free to get in touch with the customer support staff at Bitfinex whenever you need assistance. 

In the bargain, the Bitfinex customer support team makes itself available through email 24/7 and strives to respond to questions within a day of receiving them.

Mobile Trading

Because it provides a user experience that is secure, easy, and quick without sacrificing either platform’s functionality or security, Coinbase appears to be a good solution for those who are just beginning their venture into the realm of trading cryptocurrencies.

This application, which is compatible with both Android and iOS, enables you to purchase, sell, trade, and keep your currencies safe. If you’re comfortable with the platform’s fundamentals, you can upgrade to Coinbase Pro and take advantage of its lower trading costs and more advanced trading tools.

Similarly, the Bitfinex mobile app brings the full functionality of the internet platform to any device that supports Android or iOS. This makes it possible for trading to take place effortlessly when the user is going about the day. 

With this piece of software, you will have access to a wide range of sophisticated trading tools that are accessible through the Bitfinex platform, allowing you to trade numbers of the industry’s most prominent coins with ease.

How Do Coinbase and Bitfinex Compare to Other Crypto Exchanges

One obvious difference between Coinbase, Bitfinex, and Binance is that Coinbase is the only one of these exchanges governed by financial regulations. It’s also true that the security of all three of these markets has been compromised in some way, despite the various safeguards each uses. 

Nonetheless, if you’re looking for a place to buy or sell cryptocurrencies, Binance is still your best option, as it caters to both novices and expert traders and levies some of the cheapest trading fees in the industry.

Traders of all skill levels can effectively utilize Binance Lite (a beginner-dedicated platform) and Binance Pro (a platform designed with professional traders in mind) since they can be customized to their requirements. 

Yet, newcomers to the crypto market may feel overwhelmed by the sheer number of trading options available. Alternatively, they might choose one of the platforms like Gemini, Kraken, or Poloniex that is designed with new traders in mind.

Along the line, Binance stands out for its incredibly cheap costs when it comes to cryptocurrency exchanges. In particular, this exchange’s buying and selling fee is 0.5%, while the spot trade fee is only 0.1% on this global trading platform.

Binance is the clear front-runner in the business regarding trading fees, particularly when compared to the comparatively high prices that Coinbase charges for its services.

Conclusion

Although Coinbase and Bitfinex both feature user-friendly interfaces, the two companies cater to quite different types of customers with their distinct financial products. Coinbase is the ultimate choice for those who are just getting started with trading cryptocurrencies, whereas Bitfinex is more geared toward experienced traders.

The second most obvious difference between them is that Coinbase is a regulated exchange, unlike Bitfinex. Even though it is a regulated exchange, the largest platform in the United States was nonetheless subject to a cyberattack. To this end – so was Bitfinex.

Having said that, both Coinbase and Bitfinex have put in place a wide variety of security measures to guard against any potential security lapses that may occur in the future on their respective platforms and to protect their users.

In the end, the fact that Coinbase and Bitfinex continue to attract new traders despite the breaches speaks much about the lengths to which these companies are willing to go to maintain their customers’ confidence in them.