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Coinbase vs. Robinhood: Which is better?

By Chris Davis | NerdWallet

Aproper comparison of Coinbase and Robinhood depends on what service you’re looking for. Robinhood follows the playbook of a traditional stockbroker. Through the app, you can buy stocks and exchange-traded funds on the stock market, but it also has a limited menu of cryptocurrencies.

Coinbase, on the other hand, only offers cryptocurrencies (no stocks or ETFs here), and a lot more of them. Plus, Coinbase has capabilities that could be considered essential when buying crypto — capabilities Robinhood currently doesn’t have.

Fees

One advantage Robinhood has over Coinbase is the cost to purchase cryptocurrencies. On Robinhood, it’s free. You can buy and sell crypto as frequently as you want with no fees whatsoever (and pattern day trading rules that exist for stocks don’t currently exist for crypto). You’ll still have to pay the spread (the difference between the bid and ask price).

It’s worth noting that in 2020, a Securities and Exchange Commission order found that Robinhood provided “inferior trade prices,” costing customers $34.1 million. The SEC investigation was about Robinhood’s marketing and execution in general and not crypto trades specifically. Robinhood agreed to pay $65 million to settle the charges.

On Coinbase, it’s not so simple. Coinbase has a widely varying fee structure, depending on the amount you’re buying in U.S. dollars and how you’re paying for it. For example, if you’re buying $100 in Bitcoin with a debit card, you’ll pay a fee of 3.99%, or $3.99. If you pay with a linked bank account, that fee would be a flat $2.99.

Fees winner: Robinhood.

Crypto capabilities

This is another category that Coinbase should win by default: Robinhood is a stockbroker that dabbles in converting USD into cryptocurrency, while Coinbase is a cryptocurrency brokerage and exchange that also offers a hosted wallet, as well as a personal wallet if you want it.

What does that mean? With Coinbase, you have the option to buy crypto with cash, then store those coins on Coinbase’s hosted wallet. Or you can send those coins to your own Coinbase Wallet, which is completely separate from Coinbase the app. There’s also the free Coinbase Pro exchange, where you can easily deposit coins from your Coinbase hosted or personal wallet, then trade them for a much lower fee.

In short, Coinbase is a really good onramp for new crypto users, offering users many of the capabilities cryptocurrencies were created for in the first place.

With Robinhood, you can’t send coins out of the app, nor receive them from an outside wallet. Really, your only option is to convert your USD into crypto, then convert it back to USD if you want to benefit from any rise in price.

Crypto capabilities winner: Coinbase.

Technical reliability

The truth is that both companies have struggled with outages when trading volume spikes. And this, typically, is when users are most eager to have full control of their funds, whether it’s a crypto surge or crash.

So until either platform can prove it can handle an unexpected influx of activity, users should be aware that this is a real possibility. However, according to Downdetector, Robinhood has had 49 reported outages in 2021, while Coinbase has had 28, giving Coinbase a slight edge by this metric.

Technical reliability winner: Coinbase.

Ease of use

Both apps are incredibly intuitive, fast, clean and easy to use, and that makes sense: Both companies earn a large portion of their revenue through transaction volume. The more people are buying and selling, the more money they make. So it’s in their best interest to create a product that entices buying and selling, even in small amounts and reduces every bit of friction that exists on the way to pressing the “buy” button.

The end result is a product that’s excellent for beginners in the sense that the buy and sell process is stripped down to the basics; though some argue that it actually shouldn’t be this easy for beginners to trade in risky, speculative assets like cryptocurrency.

Coinbase Pro can feel more like an intermediate-toadvanced trading platform, but if you’re not ready to wade into that, the basic Coinbase platform remains extremely easy to use, as long as you’re OK paying those fees. With Robinhood, you’ll never really come across anything that resembles an advanced trading platform.

Ease of use winner: It’s a draw.

So which is better, Robinhood or Coinbase?

When it comes to cryptocurrencies, Coinbase is the clear winner here. MV

10 of the best small business opportunities

By Meredith Wood | NerdWallet

These small business opportunities are ideal for aspiring entrepreneurs who want to work from home, or who simply want to start a business in a promising, fast-growing industry.

1. Career coach

People with backgrounds in human resources, workforce development, and career services are especially well-suited for this business. If you want to specialize as a career coach for a specific field, you’ll need industry experience. Above all, you need to be an excellent listener and understand how to help people achieve their goals and dreams.

2. Cost-cutting consultant

Businesses are always looking for ways to save money. As a cost-cutting consultant, your job is to help trim the fat from a business budget and offer efficient solutions to complex problems. You need a good head for numbers, an eye for details, and general understanding of the overall operational issues a business might have.

3. Errand service

People are busy, so they’re often willing to pay for convenience. Errand services take care of the little things that people don’t have time to do, like dropping off dry cleaning, grabbing groceries or office supplies, or even stopping by the bank. You’ll definitely need a car—and make sure to visit your agent, as you’ll want commercial auto insurance for your business vehicle.

4. Event/wedding planner

According to the Bureau of Labor Statistics, the event planning industry should experience faster-than-average growth—11% over the next 10 years.

Event planners put together all kinds of events, from weddings to business conventions, birthday parties, and office holiday parties. Hospitality experience is a good start for aspiring event planners.

5. Food truck

According to Mobile Cuisine, the food truck industry has experienced a 12.4% growth trend over the past few years, skyrocketing to a $1.2 billion dollar industry as of 2015—and things have only gotten better since then.

This business is a bit trickier than the others we’ve looked at so far. You’ll need a unique idea for food items to offer, a truck to service customers, proper insurance, business licenses, operating permits (depending on the city you’re operating in), health code compliance documents, and an inventory of food items just to get started. But if cooking is your passion, then a food truck might be the way to go.

6. Freelance writer

Besides a computer and a bookmarked online dictionary, freelance writers need an impeccable handle on the English language and fairly thick skin to get started in this industry. It helps to have experience with a couple of niches, like finance or health writing, and areas of expertise, like copywriting or SaaS content writing. This job can be performed anywhere you have internet access, making this one of the best small business opportunities from home.

7. Golf coach

Getting paid to hang out at your favorite golf course all day, giving pointers to players interested in improving their games... What could beat that? Besides a thorough enjoyment of the game, you’ll need to cultivate relationships with golf courses in your community and let them know about your service, be a top-notch player, and have the communication skills to teach beginners.

8. Interior decorator

If you have an eye for design and a skill for making a room look magazine-cover ready, interior decoration might be a great business for you.

Besides creativity, you’ll need to have a knack for project management, a knowledge of design and architecture history, and CAD (computer-aided design) or drawing skills. You also need to be up-to-date on building regulations. You can market your business to building contractors or new home buyers looking for an expert opinion.

9. Professional organizer

The average American spends a total of two-and-a-half days each year looking for lost items like remote controls, books, socks, keys—and even cars. Sometimes people’s homes or offices are cluttered because they’re so busy, and other times they might just be messy.

Either way, there’s no end of business for the professional organizer.

10. IT contractor

Small businesses often don’t have the resources for an in-house IT department, but still need help troubleshooting, repairing, and upgrading their equipment. Tech-savvy individuals who go into business for themselves need to keep their computer hardware and software skills current and should be on-call whenever a client has a technological emergency. MV MN Valley Business • JULY 2021 • 27