Is Gemini better than Coinbase? Maybe you are new to cryptocurrency and looking to make a purchase for the first time or maybe you are a Coinbase user looking for a better exchange, and thinking that Gemini is it. No matter what the reason it doesn’t matter. I will be answering the question in this short post but what you should know is that the answer is not as straightforward as just Yes or No. It depends in what you are looking for in an exchange and your situation.
For the majority of people out there Gemini is going to be a better choice than Coinbase, but there are some reasons that you might want to use Coinbase instead. In this comparison I will be going over the similarities, differences, going in-depth on the fees you will be charged, and giving my opinion of which is better to use for particular people.
Gemini vs Coinbase
Both Gemini and Coinbase give users the ability to buy cryptocurrency with regular old money, such as USD and EUR. On the flipside users are also able to sell cryptocurrency back into regular money and then transfer into their bank accounts. This is what makes these two exchanges so popular because many of the exchanges out there do not deal with fiat money.
On both exchanges you can buy Bitcoin and Ethereum, but Coinbase offers Bitcoin Cash and Litecoin as well which Gemini does not. Once you have purchased cryptocurrency on either of these exchanges it will be held in your wallets that are connected to your account. Your cryptocurrency wallet can also be used to send cryptocurrency to if you are looking to sell it off back into regular money.
When it comes to trust there isn’t much of a difference in my opinion. Both exchanges are well trusted because they are transparent and are regulated within the United States, which provides much more strict regulation than many other countries out there. They have also been around for quite some time and are pretty darn popular. Coinbase was started in 2011 by Brian Armstrong and Gemini was started in 2015 by Cameron and Tyler Winklevoss.
The Big Difference
So what’s the big difference then between the two? The main difference are the fees that are charged for transactions. Coinbase is more user-friendly, has great support, and might be better for beginners in this way, but the fees charged on this exchange are much higher than that of Gemini. It is okay to purchase cryptocurrency or sell it on Coinbase, but it would be a poor decision to make trades back-and-forth.
There is also the difference that Coinbase allows users to make instant purchases with credit/debit cards, which Gemini does not. However, on Gemini you can deposit money into your account via a bank transfer and you are actually allowed to purchase cryptocurrency before the transfer goes through, which can take a few days. So although Coinbase allows more of an instant purchase, Gemini is not too far behind.
Comparison of Fees That You Will Be Charged
The fees between Gemini and Coinbase differ quite a bit and some of this is due to the fact that the services they offer differ quite a bit.
If you are looking to purchase your first cryptocurrency on either of these exchanges then Coinbase is going to be the easier method of doing so since you can purchase with a credit/debit card, but Gemini is going to be the less expensive choice.
Fees for Purchasing Crypto
So let’s say you are looking to buy bitcoin or Ethereum for the first time. On Coinbase you have four options for doing so. You can:
- Pay with a credit/debit card = 3.99% fee
- Pay with a bank transfer = 1.49% fee
- Deposit money into your account on Coinbase with a wire transfer or bank transfer = 1.49% fee
Buying cryptocurrency with your credit/debit card charges the highest fee of 3.99%, but the upside to this is that you will have it available instantly in your account, whereas the other methods it can take a few days to a week.
With the second option, which is “pay with a bank transfer”, you will be able to make a purchase of cryptocurrency at market price right then and there, but the purchase will not go through for several days.
In the last option is that you can deposit funds, such as USD, EUR, or GBP into your Coinbase account and have it available so that you can make instant purchases.
On Gemini you do not have the ability to make purchases right away. You will first have to deposit money into your account with either a wire transfer or ACH bank transfer. Luckily both of these are completely free to do.
The only fees that come into play when purchasing crypto come into play when you make the exchange to buy it. So first you deposit the money into your account and then you will exchange it for bitcoin or Ethereum. Luckily the fees are extremely low. They have what are called “maker” and “taker” fees, which I’m not going to go into detail on, but basically what you need to know is that the highest fee you get charged here is 1%. But this fee depends on the amount of volume you trade on a monthly basis. The more you trade the less your fee will be and you can actually get this down to a 0.1% fee.
Fees for Withdrawing
if you are going to withdraw cryptocurrency from either of the exchanges you will get charged a small fee along with the network fee for actually processing the transaction on the blockchain. These fees will vary quite often so I’m not going to state any numbers here. However I will say that these aren’t anything to worry about much.
Now if you are going to be selling cryptocurrency back into fiat money, such as USD, EUR, etc., and then transferring it to your bank account there is a big difference.
On Gemini it is free to withdraw money like this but on Coinbase you will have the options of doing a bank transfer or a wire transfer and either way you’re going to be charged 1.49%.
Which Is Better?
It really depends all on what you’re looking for. If you are an absolute complete newbie and want things to be as easy as possible then Coinbase might be the better option for you but if you are looking to pay as little fees as possible then Gemini is definitely the better option.
If you are looking to actively trade between cryptocurrencies and fiat currencies, such as USD, then using Coinbase is out of the question. If you trade back and forth with Coinbase you will be absolutely hammered with fees and it will not be worth it, which is why I wrote a post warning people not to daytrade on Coinbase. But if you’re actively trading back and forth on Gemini the fees can be very small, of course depending on your trade volume for that month, and Gemini also gives you the ability to trade between Bitcoin and Ethereum. On Coinbase you are not able to trade between cryptocurrencies.
Both exchanges are trusted, both give you the ability to buy and sell cryptocurrency in and out of fiat money, it’s just that Coinbase charges much higher fees, which a lot of this is due to the fact that they are more user-friendly.
If I were you I would just go with Gemini. Although I’ve been saying that Coinbase is more user-friendly, which it is, Gemini is still also pretty easy to use and even if you have never bought cryptocurrency before it’s not that difficult to use this exchange.
I would also suggest looking into the GDAX exchange. GDAX is actually another exchange that is owned by Coinbase but is more like Gemini. It charges minimal fees and allows users to buy cryptocurrencies with fiat money as well as sell them back into fiat money. The upside to using GDAX over it Gemini would be that they offer more trading pairs. But anyway, you can read my comparison of Coinbase and GDAX here to learn more about that.
As always, leave any questions or comments you may have below. I will be happy to answer them and help you out when time permits 🙂