eToro vs. Coinbase

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Both eToro and Coinbase are cryptocurrency exchanges that let investors buy and sell Bitcoin and other popular crypto coins and store them securely in built-in digital wallets. 

eToro is a popular online social trading platform founded in 2007 that lets investors participate in copy trading by copying the portfolios of successful investors. The company launched its cryptocurrency platform in 2018, giving users the ability to invest in Bitcoin as well as other popular cryptocurrencies.

Coinbase was founded in 2010 as a cryptocurrency exchange that lets users directly buy, sell, and trade crypto. It has grown into one of the largest exchanges by volume and went public in April 2021, selling shares of COIN stock as a direct listing. The platform offers simple onboarding and access to over 50 cryptocurrencies for trading.

eToro and Coinbase serve different purposes in the crypto marketplace. While eToro lets users buy and sell cryptocurrency as part of their investment strategy, Coinbase is a true crypto exchange, allowing you to purchase, trade, exchange, and withdraw your cryptocurrency. Similarly, eToro acts as a custodian for the crypto they sell while Coinbase gives you direct ownership via a digital wallet.

We’ve reviewed both platforms based on their supported currencies, security, fees, features, and more to help you decide which platform is best for your crypto investing style.

eToro vs. Coinbase: How Do They Compare?

eToro does allow users to withdraw their crypto into their eToro wallet, but this wallet cannot be used on any decentralized exchanges. Crypto must be transferred to an external wallet for additional functionality.

eToro vs. Coinbase
eToro vs. Coinbase

eToro


eToro

 eToro

eToro is currently offering a $50 bonus for customers that purchase $500 worth of cryptocurrency through their platform. This promotion is in select U.S. states.

eToro USA LLC; Investments are subject to market risk, including the possible loss of principal. This is not investment advice.

What We Like
  • Copy trading portfolios

  • Simple mobile app

  • Margin trading (not available to U.S. residents)

What We Don't Like
  • Withdrawing crypto requires multiple steps

  • Can’t deposit, trade, or exchange crypto

  • Spread fees up to 5%

Coinbase


Coinbase

Coinbase

What We Like
  • Allows deposits, trading, or withdrawing of crypto

  • Supports 50+ currencies

  • Free educational videos

What We Don't Like
  • High fees for credit and debit card users

  • $2 minimum order

eToro vs. Coinbase: At a Glance

  eToro Coinbase
Features Access to copy trading portfolios; available in over 140 countries; simple-to-use mobile app Simple-to-use mobile app; buy, sell, and trade crypto; store crypto in Coinbase Wallet
Fees 0.75–5% spread fee for buying and selling crypto; no commissions or fees for deposits; $5 withdrawal fee  0.50% per trade; additional 1.49% for bank account or Coinbase Wallet purchases; additional 3.99% for debit or credit card purchases; $10 deposit; $25 withdrawal fee for wire transfers
Cryptocurrencies supported 15 cryptocurrencies 50+ cryptocurrencies
Security features 2FA via SMS only; cold storage of crypto; USD balances FDIC insured up to $250K; KYC requirements for access; biometric access 2FA via SMS or Google Authenticator app; cold storage and multi-signature wallets; USD balances FDIC insured up to $250K; KYC and anti-money laundering protections
Types of transactions Buy, Sell; limit orders; stop loss; trailer stop loss; take profit trade; margin trading (not available in the U.S.) Buy, Sell, Exchange, Send, Receive

eToro vs. Coinbase: Ease of Use

While eToro makes it easy to sign up with an email, username, and password, the platform is not the most user-friendly for brand new crypto investors. Between multiple trade options and its own assets, eToro can feel overwhelming to beginners. 

Users who sign up for eToro will be required to prove their identity by submitting a picture of a photo ID and proof of address, which can be as simple as a screenshot of a utility bill. You can then add a payment method (bank account or credit/debit card) and start buying and selling crypto.

Coinbase has a similar easy sign-up process and requires users to verify their identity with a photo ID. The user experience overall on Coinbase is much simpler than eToro, however, making it easy and intuitive to buy, sell, or trade currencies. No advanced trading or margin is available on Coinbase which actually makes it more accessible to beginners. 

Crypto purchases on deposited funds may not be available for withdrawal until the deposited funds have cleared. This may take up to seven days on either platform.

eToro vs. Coinbase: Security

eToro and Coinbase take security very seriously and adhere to country and local regulations closely. Here are a few of the security features available on each exchange:

eToro Security Features

Two-factor authentication: eToro allows users to enable two-factor authentication (2FA) via SMS.

Biometric access (mobile apps): eToro supports biometric verification via fingerprint scanning through its mobile app.

Cold storage: eToro states that most of their cryptocurrency is stored offline though it doesn’t say what percentage. 

FDIC insurance (up to $250K): eToro protects all USD funds with FDIC insurance up to $250k. This does not insure your cryptocurrency holdings. 

Coinbase Security Features

Two-factor authentication: Coinbase takes authentication security a bit further than eToro by offering 2FA both via SMS or the Google Authenticator app.

FDIC insurance (up to $250K): Similar to eToro, Coinbase also offers FDIC insurance on USD deposits up to $250,000.

Cold storage and crypto vaults: Coinbase stores 98% of all their crypto assets offline in cold-storage vaults. This keeps assets off of the internet and away from hackers and online thieves.

Coinbase also offers a cryptocurrency vault that requires you to get approval from multiple users in order to withdraw your funds.

Built-in ERC-20 wallet: Coinbase lets users transfer funds from the exchange into their personal custody using an ERC-20 compatible wallet for Ethereum-based applications as well as decentralized exchanges.

eToro vs. Coinbase: Features

eToro and Coinbase allow the buying and selling of crypto assets, but each platform goes about it in its own way. Here are a few of the unique features offered by each platform:

eToro Unique Features

CFD trading: eToro offers Contract for Difference (CFD) assets allowing users to purchase the contract to hold or invest in a cryptocurrency without actually owning the asset itself. Margin trading is also available when buying and selling CFDs to give you more leverage in your trades.

Note: Margin trading is not available to U.S. residents.

Copy trading: Because it’s a social investing platform, eToro lets users select top-performing portfolios and copy the trades from that portfolio automatically.

No fees for deposits: eToro does not charge fees when users deposit funds into their account, whether by debit card, credit card, or bank account transfer.

Coinbase Unique Features

Use your crypto: While eToro lets users withdraw crypto using the platform’s proprietary wallet, the wallet can’t be used on blockchain applications and exchanges. Coinbase’s ERC-20 compatible wallet, however, can be used on any Ethereum-built application or decentralized exchange. 

Directly exchange crypto: Coinbase makes it easy to exchange one cryptocurrency for another directly on its platform so users can save on fees when selling one crypto to buy another.

Access educational videos: Coinbase hosts educational videos on many of the currencies they support, helping beginners learn more about the currency. The platform even gives bonus cryptocurrency rewards after you take a quick test to show what you’ve learned.

eToro vs. Coinbase: Currencies

eToro supports 15 different cryptocurrencies, including Bitcoin, Ethereum, and XRP. In comparison, Coinbase supports over 50 of the top cryptocurrencies and is adding more every month. Both platforms also allow users to purchase fractions of cryptocurrency in dollar amounts, with eToro setting a $25 minimum trade size and Coinbase a $2 minimum order amount. 

eToro vs. Coinbase: Fees

eToro charges a fee for the “spread” when purchasing cryptocurrency which varies by the type of crypto being purchased. Fees range from 0.75% all the way up to 5%.

Coinbase charges a fee of 0.50% for transactions and additional fees based on the method of payment used. Both platforms charge much higher fees than most other crypto exchanges.

Here is a breakdown of how eToro and Coinbase charge fees based on account type:

Account eToro Fees Coinbase Fees
U.S. Bank Account 0.75% to 5% 1.49%
Wallet 0.1% crypto exchange fee 1.49% 
Credit/Debit Card Buy 0.75% to 5% 3.99%
Instant Card Withdrawal N/A Up to 1.5% of any transaction and a minimum fee of $0.55
ACH Transfer Free Free
Wire Transfer $5 outgoing $10 ($25 outgoing)

eToro charges fairly high fees for purchasing crypto, but does not charge any fees for depositing funds, and their 0.1% exchange fee within the eToro wallet is very low.

Coinbase charges very high fees for debit and credit card users. In addition to the 0.50% spread fee, frequent transactions can become very costly.

Both eToro and Coinbase are best for buy-and-holding investing to avoid large trading fees.

eToro vs. Coinbase: Access

Coinbase is available globally in just over 100 countries around the world and legally in all 50 states in the U.S. eToro is only available in the U.S. in 41 states plus the Northern Marianas (as of April 2021) but is actively working to add Delaware, Minnesota, New Hampshire, New York, Nevada, Puerto Rico, and Tennessee.

Each country has its own regulations around cryptocurrency. Be sure to review your local guidelines before buying or selling crypto.

Final Verdict

eToro and Coinbase are designed to help users invest in cryptocurrency, but while eToro gives users exposure to crypto assets, Coinbase is a true crypto exchange that lets you actually own your crypto. 

eToro is designed for investors who simply want exposure to crypto as an asset class or for speculative purchases. By contrast, Coinbase is designed to give users simple access to a wide range of cryptocurrencies, educate them about blockchain, and giving them ownership of their crypto assets.

No matter which platform you choose, investing in cryptocurrencies is highly speculative. Never invest more than you are willing to lose.

eToro vs. Coinbase FAQs

What Are eToro and Coinbase?

eToro and Coinbase are regulated cryptocurrency exchanges that allow customers to buy, sell, and trade crypto

eToro is a global trading platform that also allows users to trade stocks, foreign currencies, and 15 different cryptocurrencies while Coinbase is a true exchange that only sells crypto. Coinbase also gives users access to 50+ currencies, as well as the ability to trade or withdraw assets to a digital wallet.

How Do Coinbase and eToro Work?

eToro is an online broker that allows you to purchase or sell crypto assets, acting as a custodian of the cryptocurrency until you sell or withdraw your assets to your wallet.

Coinbase is a U.S.-based cryptocurrency exchange that allows users to buy, sell, trade, or withdraw cryptocurrency. It also acts as a custodian of the currency until users withdraw, trade, or sell their crypto.

To buy cryptocurrency like Bitcoin on either platform, simply connect your bank account or payment card, select how much Bitcoin you want to buy (in USD amounts), and then make the purchase. Both eToro and Coinbase store that asset in cold storage until you want to sell, trade, or withdraw crypto into your digital wallet.

Should I Use the Coinbase Wallet?

Both eToro and Coinbase offer a digital wallet for storing your crypto assets. And while each lets users transfer their crypto assets into a digital wallet, Coinbase’s wallet connects to Ethereum-based applications and decentralized exchanges for more versatility. Coinbase also lets you set a 12-word recovery phrase, acting as a private security key to their assets. eToro does not let users hold their own wallet keys.

Who Should Use eToro vs. Coinbase?

eToro is best for investors who want exposure to cryptocurrency but don’t care to have access to the actual currency itself. It’s also best for traders who want to be able to trade stocks and crypto within one platform.

eToro offers crypto trading in more than 140 countries and 42 U.S. states and territories but traditional stock trading is only available to non-U.S. residents.

Coinbase is best for beginner crypto investors who want access to a wider range of cryptocurrencies and use those currencies on the Ethereum network or on other decentralized exchanges. Coinbase also gives new investors access to free educational content, an easy-to-use app, and top-notch security.

How We Evaluated eToro vs. Coinbase

When reviewing eToro vs. Coinbase we compared each platform based on ease of use, fee structure, security, unique features, and supported currencies. We also took into account the types of trades available on each platform and their relative cost to the wider cryptocurrency exchange market.

Both platforms charge high fees but offer a good user experience. While eToro offers more functionality outside of the cryptocurrency market, Coinbase is a more feature-rich platform for crypto beginners. eToro is also more suited for investors outside of the U.S. who want access to their margin trading and other capabilities while Coinbase is best for beginner crypto investors who want to own their coins and wallet keys.

Both platforms are fairly limited in their trading capabilities, so advanced crypto traders would be better suited by another exchange option.

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