Having trouble choosing which crypto exchange to use? Not to worry, we’ve got you covered regarding this subject! Today we’re going to put two very popular and important exchanges face to face: Bitstamp vs Coinbase.
Millions of people buy/sell cryptocurrency every day, all day, non-stop using trading platforms. How do you know which is the right pick for you?
You’re probably trying to find a way to get into all this action and we’re here to help get you there!
Once done with this article, you’ll have developed your own criteria to make an informed decision as to which of these two platforms is the one that would benefit you the most, and decide which is the best for your particular needs.
Let’s get started!
Bitstamp vs Coinbase: What’s the Main Difference?
If we could sum it all up it would be like this. You could think of Coinbase as a vendor/provider for users to buy/sell cryptocurrencies for fiat (regular money) directly from Coinbase. Bitstamp is what we can call a formal exchange that allows users to exchange crypto/fiat in trading pairs. It’s that easy.
-What do you mean by trading pair?
Trading pairs are extremely common when trading a virtual currency on an exchange. In most cases, people will be using Bitcoin to trade against other cryptocurrencies, but there are many trading pairs available (Ether, Litecoin for example).
In that case, how do crypto trading pairs work?
Cryptocurrency trading pairs work the same way as if you were going to a store and seeing what a certain product is worth. This creates value.
Although oversimplified, that’s pretty much how it works, the only difference being people don’t use multiple currencies for everyday transactions as is done with cryptocurrency. Trading pairs help to establish the value of an asset when it’s traded for another asset!
Bitstamp vs Coinbase: Currencies Used
So what exactly can I trade? Let’s look at each of the currency trading offered by exchanges:
Fiat Currency Trading
Fiat currencies are very easy to understand. It’s basically the currency that’s legally backed up by a national government. Examples include:
Canadian Dollar (CAD), or the United States Dollars (USD), and so on. These currencies account for most of the developed world.
Trading with fiat currencies( Euros and US Dollars) is available with Bitstamp, for those wondering if Bitstamp works in the US or with US dollars.
With Coinbase, you are able to use a specific country’s currency to buy Bitcoin or other cryptocurrencies. Coinbase is available in 32 countries.
Bitstamp offers 5 virtual currency trade options and 11 unique trading pairs.
The cryptocurrencies that can be exchanged on Bitstamp are Bitcoin (BTC), Bitcoin Cash (BCH), Ethereum (ETH), Ripple (XRP)Litecoin (LTC)
Coinbase differs a bit from Bitstamp in this regard. You can even say that Bitstamp is like a marketplace, bringing buyers and sellers together. If you have a specific currency you want to buy at a certain price point, then Bitstamps will help make that match for you. Well, that sounds nice, doesn’t it? But what does Bitstamp get out of it? They charge a percentage fee for any transaction taken place on their platform.
Coinbase works somewhat differently. Coinbase is a brokerage. This means that it buys and sells cryptocurrency for fiat currency. Buyers/sellers trade directly with Coinbase instead of with each other.
The cryptocurrencies that you can buy or sell using the Coinbase conversion service are;
Bitcoin (BTC), Litecoin (LTC), Ethereum (ETH), Bitcoin Cash (BCH)
Are Prices Different on Bitstamp vs Coinbase?
No exchange service is complete without its share of fees. There’s no “one-size-fits-all” in regards to fees here, but we will go over some basic information regarding fees for Bitstamp and Coinbase.
Bitstamp offers some of the lowest fees compared to others on the same market.
The fee is pretty basic: 0.25% for all trades under 20,000 USD. Buying or selling? It’s the same fee amount. Excellent for beginners!
The only other charge to be aware of is the Bitstamp credit card fee, which is 5% of any purchase amount.
With Coinbase it’s a different story. Coinbase trading fees can definitely add up, sometimes up to 6 times higher than Bitstamp’s fee. Basically, it’s a 1.49% fee for any buying/selling transaction and goes up to 3.99% for transactions made with a credit card.
Even so, compared to exchanges, Coinbase fees are still pretty low.
Are Mobile Apps Available?
Yes! Both do, but here are the differences.
Bitstamp’s score is 1.7 out of 5 at the Apple store. Yikes! Bitstamp’s mobile app definitely has its share of complaints from users, mainly about the lack of feature the app has. Also, many reviews indicate that the app is slow and has very few updates.
On the other hand, Coinbase is rocking with very favorable reviews. A 4.7 score shows that its clients are definitely happy with its simple and easy to navigate features.
How About User Friendliness?
Coinbase is usually the go-to recommendation for beginners due to a simpler platform. While Bitstamp’s platform is high up there in terms of design, it’s very limited on what you can do. Not only that but the Tradeview page on Bitstamp’s platform can be very difficult for beginners to navigate. The whole interface can be very confusing actually.
Coinbase takes the win on this feature since its platform is a lot like online banking apps. The layout is simple and clear.
Both exchanges are rather “young” from a business standpoint, however, they’re throwing it out of the park. Just look at this data! The Coinbase platform has served for over 50 billion US dollars worth of buying/selling and encompasses 32 countries, serving more than 10 million customers.
CoinMarketCap’s list of 212 exchanges ranks Bitstamp as #15. 195,091,734 US Dollars are traded in a 24-hour window.
Can I Count on Having Security?
Bitstamp really takes this seriously and very safe exchange to use. In January 2015, 19,000 BTC were stolen from Bitstamp and was quite a wake-up call for them. The platform was recreated with new security upgrades such as cold storage digital assets, two-factor authentication, and others to supply its clients peace of mind.
Coinbase has never been hacked, but sometimes passwords are stolen, and these sorts of situations. Nothing to do with the platform in this case.
Coinbase can brag about a great safety record when compared to most other exchanges. It also helps that 98% of their funds are kept offline, and keeps customer funds separate from the actual Coinbase funds.
Thank you for coming along on the ride with us. Are you ready to choose?
Bitstamp and Coinbase are great reliable options to begin your crypto journey.
Both platforms have high standards of security and have happy customers around the world. While Coinbase is ideal for beginners, Bitstamp could be a bit more challenging to learn but it’s a great place to learn how a professional crypto exchange works. You might even reach a point in which you transfer from Coinbase to Bitstamp!
As of now, we recommend Coinbase for those starting to venture in the crypto world, and once you’ve become a seasoned trader, Bitstamp will be right there waiting. Then pretty soon after you’ll be here again telling us all about your experience with Bitstamp vs. GDAX.
Can’t decide yet? Let us know in the comments which platform you prefer and when you plan to start your journey.
Looking forward to hearing from you.
Jesus Cedeño is a certified doctor turned cryptocurrency expert, writer, and investor who lives in New York City. Jesús specializes in cryptocurrency product reviews, tutorials & technical analysis. Follow him on LinkedIn to stay up to date on his latest work on blockchain, decentralization and crypto investments.