Coinbase is currently one of the most popular exchange platforms for trading in cryptocurrencies. It currently has over 11.5 million users and 38 million wallets, and as such it’s no wonder that it has the most mass appeal.
In fact, Coinbase is one of the first platforms most people go to when they’re just starting off as beginners. This is because Coinbase is highly trustworthy and it’s quite user-friendly as well.
However, Coinbase comes with its fair share of troubles and drawbacks as well. As such, in this article, I’ll list out all the drawbacks of using Coinbase and then offer alternative platforms to you.
Before you read on, however, it’s advisable if you go through our Coinbase Review as well so you have a more holistic understanding of this platform.
PART 1: Coinbase Problems
Coinbase is an extremely user-friendly trading platform. And for certain people, it really is the ideal option. However, it has several major drawbacks as well. You can read about them below:
Coinbase is currently only available in 32 countries across the globe. You can check whether your country is permitted in Coinbase online. It’s strange that a cryptocurrency platform would have limitations based on geographical location, especially since cryptocurrencies are supposed to be a decentralized system.
Coinbase has stated that they want to expand operations to all the countries across the globe. However, despite being valued at $1 billion and raising $100 million in funds, they’ve not yet taken any steps towards making that happen.
Limited Payment Methods
Even if you’re from the supported countries, you might still face limitations based on payment methods. Bank Transfers and Credit/Debit card payments are widely accepted by Coinbase. However, some of the advanced payment methods such as PayPal are only available in the US.
Coinbase only accepts trading in the most popular cryptocurrencies such as Bitcoin, Ethereum, and Litecoin. If you want to trade in other lesser-known currencies, you’ll have to find other platforms.
High Transaction Fees
Coinbase charges a transaction fees of 1.49% to 3.99% depending on the country and the payment method. While this isn’t the highest transaction fee out there, it’s far from being cheap. Furthermore, this makes Coinbase the wrong platform for active trading of cryptocurrencies. You can check out the transaction fees at the Coinbase Pricing & Fees Disclosures Page.
In the next part of this article, I’ll give a few alternatives to Coinbase that rectify all of these drawbacks.
PART 2: 5 Best Alternatives to Coinbase
The following are a few alternative platforms you can use instead of Coinbase. All of these platforms also come with their advantages and disadvantages, however it’s up to you to decide which ones suit you best.
|Exchanges||Security||Fees||Payment Supported||Cryptocurrency Supported||Check Reviews|
|Moderate||0.1%||Only Cryptocurrencies||Bitcoin, Bitcoin Cash, Ethereum, EOS, LiteCoin + many more||Binance Review|
|Risky||0% to 1%||Depends on Seller||Depends on Seller||LocalBitcoins Review|
|Risky||0% to 1%||Depends on Seller||Depends on Seller||Paxful Review|
|Moderate||5%||MasterCard/Visa, Skrill, and others.||Bitcoin, Ethereum, Dash, and Litecoin||BitPanda Review|
|Great||0.50% to 2%||Credit Cards, Bank Transfers||Bitcoins, Ethere-um, and Dash||CEX.IO Review|
Coinbase Alternative – Binance
They offer an incredibly low transaction fee, and come with high-reward investment modules in the form of ICOs. This makes Binance fairly complex, however, it’s something that seasoned traders prefer.
However, it does rectify a lot of the drawbacks that Coinbase suffers from. For example, it comes with a wide range of cryptocurrencies being supported, and it’s available in all the countries across the globe. However, one of its major drawbacks is that it only supports crypto-to-crypto transactions.
As such, if you’re looking for a platform with a range of cryptocurrencies, low trading fees, and available in all countries, then this is perfect. However, if you’re a beginner looking to buy cryptocurrencies with fiat currencies, then you’re better off with Coinbase.
Coinbase Alternative – LocalBitcoins
LocalBitcoins is perhaps one of the most flexible alternatives to Coinbase. It’s a P2P Bitcoin exchange platform. This basically means that LocalBitcoins acts as an escrow platform where buyers and sellers can meet, interact, strike a deal, and hold transactions.
This free-market nature of the platform means that LocalBitcoins supports a wide range of cryptocurrencies, accepts payments in various currencies and via a number of different payment methods, and is accessible in every country in the world. Furthermore, they also don’t charge any transaction fees from the buyers and only a 1% fee from the sellers. As such, LocalBitcoins addresses every single drawback of Coinbase, making it an almost ideal alternative.
However, LocalBitcoins also comes with its drawback. Coinbase is generally meant for beginners, but LocalBitcoins should ideally be used by professionals only. This is because there are a lot of scammers available in the free market system, and as such you need to have the experience to be able to detect them and avoid being scammed.
Coinbase Alternative – Paxful
Paxful is another P2P exchange platform, similar to LocalBitCoins. Even this platform helps you connect with other sellers and buy cryptocurrencies across the globe using a number of different payment methods.
However, just like LocalBitcoins, Paxful too comes with the same major disadvantages. Since it’s a P2P platform, you need to be wary of scam sellers and buyers online. If you’re a seller, you shouldn’t accept PayPal payment as that can be easily reversed. And if you’re a beginner, you should likely avoid it because you might be easily ensnared into a fraud.
However, if you’re looking for wide geographical accessibility, cryptocurrencies support, currencies support, or diverse payment methods, then Paxful is perfect.
Coinbase Alternative – Bitpanda
Bitpanda is an Austria based exchange that was founded in 2014. It accepts all of the major cryptocurrencies such as Bitcoin, Ethereum, Dash, and Litecoin, accepts payment in euros, and is only available in the UK or the EU nations. As such, it has similar limitations as Coinbase, and it also comes with a high transaction fee of 5%.
However, if you’re someone residing in the EU or the UK, then you might prefer this as an alternative to Coinbase. If so, you can go ahead and create an account with Bitpanda immediately.
But before you do, please take the time to read our Bitpanda Review first.
Coinbase Alternative – CEX.IO
CEX.IO is one of the first generation cryptocurrency exchange platforms, having been launched in 2013. It’s based in London, and it supports the trading of Bitcoins and Ethereum. They don’t have a wide compatibility in terms of cryptocurrencies, but they are operational in 99% of the countries. As such, if you’re from one of the countries that are disqualified from using Coinbase, you can use CEX.IO instead.
CEX.IO also allows you to instantly purchase cryptocurrencies using a Visa/MasterCard credit/debit cards. However, this platform comes with one major drawback. It charges an incredibly high 7% transaction fees on buying and selling cryptocurrencies. This makes it a terrible option for active trading. However, if that’s not an issue for you, then go ahead and start trading on CEX.IO!
However, I would highly recommend that you read a review for it first.
PART 3: Best Coinbase Alternative – My Choice
The Coinbase alternatives that I’ve listed out all serve different purposes.
Binance has a low transaction fee and is available across the globe with a variety of different cryptocurrencies. However, they don’t accept fiat currencies for payment.
LocalBitcoins and Paxful are P2P platforms, which means that you can find most flexibility in them, in terms of cryptocurrencies available, countries supported, etc. However, they’re not ideal for beginners because of the risk of falling prey to scammers.
BitPanda is a similarly reliable platform as Coinbase, however they’re only functional in the UK or the EU.
And CEX.IO is operational in most countries across the globe. However, it charges an extravagant transaction fee.
My Choice – LocalBitCoins or Paxful
That’s because they address all the drawbacks of Coinbase. It’s true that you need to be very vigilant while using them. However, if you follow the website guidelines carefully, you won’t run into any trouble and you’ll get a much better deal and flexibility than all other services.
PART 4: Conclusion
Well, now you know about all the different alternatives to Coinbase out there. As you can see, all of them come with their own set of advantages and disadvantages as well. You just have to balance the two and figure out which one is ideal for you. My personal recommendation is Paxful or LocalBitcoins for all the reasons mentioned above, but any of the other Coinbase alternatives are also great.
Please comment down below and let me know which platform you’re most interested in checking out.