Want to jump straight to the answer? The best Robinhood alternatives are Coinbase and Voyager!
For new investors, Robinhood is a great place to start. Its simple user interface, low fees and mobile app make it easy for investors to manage their portfolios. While Robinhood is a great option for investing in stocks, most crypto investors would agree there are better alternatives when it comes to investing in crypto.
Without a functional cryptocurrency wallet, investors who use Robinhood for crypto aren’t able to send or receive funds on the platform. Also, there’s a lack of variety in cryptocurrencies on the platform, greatly limiting your investment options.
Checkout the best Robinhood Crypto alternatives to find a dedicated cryptocurrency exchange to better serve your needs.
What is a Cryptocurrency Exchange?
Cryptocurrency exchanges work in a similar way to stock exchanges. Investors submit buy and sell orders, which create the exchange’s order books. The market price is the highest buy order or lowest sell order, depending on whether you’re buying or selling crypto.
Most dedicated cryptocurrency exchanges, like Coinbase and Gemini, have dedicated cryptocurrency wallets to store your crypto. Cryptocurrency wallets are a vital part of crypto exchanges, as they allow you to send and receive digital assets on the platform.
Depending on the exchange you use, your investment options may differ. Most cryptocurrency exchanges allow investors to buy and sell crypto using market and limit orders, and some even allow you to trade altcoins against other cryptocurrencies. For example, Binance lets investors trade altcoin-bitcoin pairs, allowing traders to track their investment’s return against that of Bitcoin.
What Makes Robinhood Unique?
Robinhood is arguably the most unique cryptocurrency exchange, as its main focus is stocks. Because of this, your crypto options on the platform are pretty limited. Some key features that draw investors to Robinhood are the ability to buy stocks and crypto in the same place as well as free transaction fees.
Another selling point for Robinhood Crypto is its user interface. Those who already use Robinhood for stocks are acquainted with the platform’s user interface, making the learning curve for crypto investing close to zero.
Why Robinhood Crypto Might not be Right for you
While Robinhood is a great place to get started investing in cryptocurrency, it’s not ideal for every crypto investor. As previously stated, Robinhood has yet to develop a cryptocurrency wallet on its platform.
Not only does this limit how you fund your account, but it limits you from interacting with decentralized finance (DeFi) programs. Cryptocurrency investors use DeFi programs like Aave, Uniswap and Compound to earn interest on your crypto holdings, consequently increasing your return on investment.
Common Complaint: Lack of Altcoins
Another common complaint about Robinhood is its lack of altcoins. If you choose to invest in crypto on Robinhood, you won’t be able to buy innovative altcoins involved with DeFi. Instead, you’ll be limited to “dinosaur cryptos” that have been around a long time but are generally seen as obsolete.
Some of these dinosaur cryptos that Robinhood offers are Dogecoin (D), Litecoin (Ł), Ethereum Classic (ETC), Bitcoin Cash (BCH) and Bitcoin SV (BSV). Besides these outdated projects, the platform also let’s you buy Ethereum (ETH) and Bitcoin (BTC).
What to Look for in a Cryptocurrency Exchange
There are several factors to consider when choosing a cryptocurrency exchange. Among these factors, security should be one of your main concerns. Large, U.S.-based exchanges are typically the most secure way to buy crypto, making Coinbase, Gemini and Robinhood all very secure options.
Other than security, you should consider the exchange’s features before choosing an exchange. Some exchanges allow leverage trading, while others let you convert cryptocurrency for free, making it easy to manage your portfolio.
Another key factor to consider is the altcoins that the exchange supports. While some exchanges only offer a few coins, others like Binance, Gemini and eToro offer dozens of options to choose from. If there’s a particular cryptocurrency you’re looking to buy, make sure it’s supported by the crypto exchange you make an account with.
The Best Alternatives to Robinhood Crypto
Looking for a Robinhood alternative to invest in crypto? Benzinga has put together the best Robinhood Crypto alternatives, so you can find the best exchange for your personal needs. Depending on what you seek to accomplish through crypto investing, it may be a good idea to use several exchanges. In any case, be sure to secure your account with 2-factor authentication to prevent any potential security breaches to your account.
- Active Crypto Traders
Coinbase
Coinbase is among the most secure cryptocurrency exchanges on the market. Not only is it a publicly traded company, but the exchange secures 98% of users’ funds in cold storage, meaning it’s not accessible through the internet. This way, online hackers won’t be able to steal the majority of funds even if they were able to breach Coinbase’s industrial-grade security.
Also, Coinbase Earn gives you free cryptocurrency for learning about the technology behind crypto. Simply watch a short video and answer some questions and Coinbase will deposit cryptocurrency into your exchange account.
- Low Minimums
Webull
While Webull has a similar offering to Robinhood, the platform has a few extra goodies that may make it worth using. The exchange has a couple extra altcoins that aren’t on Robinhood, such as Stellar Lumens (XLM) and Zecash (ZEC).
Also, Webull has customizable charts, which may come in handy if you’re a day trader. It also supports 2-factor authentication, so rest assured your funds will be safe. Alongside cryptocurrency, Webull offers a range of stocks to invest in, similarl to Robinhood.
- New Investors
Gemini
Gemini is a dedicated crypto exchange based in the U.S. Not only can you invest in cryptocurrency on Gemini, the platform also allows investors to stake their cryptocurrency investments to earn interest on their holdings. If you’re planning to buy crypto for the long term, you should consider using a platform that allows you to earn interest on your crypto.
Also, Gemini offers many more altcoins than hybrid stock-crypto exchanges like Robinhood and Webull. Not only does Gemini support more than 30 cryptocurrencies, it also offers 19 crypto-crypto pairs, so you can trade crypto against major players like Bitcoin.
- Mobile Traders
Voyager
Given the plethora of features on Voyager, it’s a great choice for a variety of cryptocurrency investors. The exchange supports more than 50 different cryptocurrencies, so you’ll be less limited as to what you invest in than other exchanges.
Plus, Voyager supports cryptocurrency staking on its mobile app and website. Users can choose to stake their investments on Voyager to receive up to 10% annual interest. If you’re long on crypto, then staking is a no-brainer.
- Altcoin Trading
Binance
Binance is the world’s largest cryptocurrency exchange, but its main focus is outside of the U.S because of strict Securities and Exchange Commission (SEC) regulations. The non-U.S. website hosts tons of features, including staking, leverage trading and small-market cap altcoins. However, most U.S investors use Binance.us, which has limited features.
Regardless, Binance is the best place to trade altcoins. It has low trading fees, and the platform supports over 50 altcoins. Plus, the Binance mobile app is handy for investors looking to day trade crypto. If you’re looking to dollar-cost average your way into crypto, Binance gives you the option to set recurring buys daily, weekly or monthly.
Is Switching Exchanges Worth it?
In many cases it’s worth it to switch exchanges. However, if you’re only interested in investing in Bitcoin and Ethereum, then Robinhood is a good all-in-one choice to do so. This being said, using Robinhood for cryptocurrency will greatly limit your investment’s potential. If you decide to switch exchanges, you’ll be able to earn passive income through DeFi interest rates. Plus, you’ll have many more altcoins to choose from on other exchanges.
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