BlockFi vs. Coinbase: Which Is Right for You? | The Ascent

blockfi vs. coinbase: available cryptos

coinbase has one of the largest selections of cryptocurrencies, even when compared to other major cryptocurrency exchanges, and is way ahead of blockfi in this regard.

there are more than 150 cryptocurrencies available on coinbase. it has many different types of cryptocurrencies, from the market leaders to smaller tokens, and adds new ones regularly. there are several big cryptocurrencies that are available on coinbase, but not on blockfi, including:

Reading: Blockfi fees to buy bitcoin

  • cardano (ada)
  • solana (sun)
  • polkadot (dot)
  • avalanche (avax)

blockfi has over a dozen cryptocurrencies, so it gives you some investment options, but your selection is much more limited. To its credit, blockfi is great for stablecoins, which are cryptocurrencies tied to another asset. the platform has multiple u.s. dollar stablecoins. it also has a gold-backed stablecoin, pax gold (paxg), which is not available on coinbase.

related: what are stablecoins?

blockfi vs. coinbase:wallets

blockfi offers a custodial wallet, a type of wallet controlled by the crypto platform. With a custodial wallet, the risk is that you are not in full control of your funds. some investors prefer to transfer their crypto to their own non-custodial blockchain wallet for this reason.

See also: What is Bitcoin? 1 Simple Explanation for Kids & Beginners

You can transfer most cryptocurrencies on blockfi to another wallet. however, it does not allow external transfers with three cryptocurrencies: dogecoin (doge), algorand (algo), and bitcoin cash (bch). that’s a noticeable downside if you plan to buy any of those on blockfi, because you won’t have full control over them.

coinbase offers a custodial wallet and a non-custodial wallet, the coinbase wallet, where the user controls their crypto. Coinbase wallet is a hot wallet, which means it is connected to the internet and available for download on mobile and desktop devices. you don’t need to be a coinbase user to download the coinbase wallet; it’s free for anyone to use.

see more options: best crypto wallets

blockfi vs coinbase: security

both blockfi and coinbase provide a high level of security. the biggest difference between them is how they store cryptocurrency funds.

blockfi does not hold the funds itself and instead uses custodians to protect these assets. Its primary custodian is Gemini, an extremely secure crypto exchange. gemini stores most digital assets offline in cold storage and has insurance for crypto stored in its online hot wallet.

See also: Hodlers and whales: Who owns the most Bitcoin in 2022?

related: what is cold storage in crypto?

coinbase is the custodian of its customers’ crypto funds and uses the same storage methods as gemini. It keeps 98% of crypto assets in cold storage and secures the rest that is stored in hot wallets. coinbase also offers fdic insurance of up to $250,000 per individual on cash deposits, while blockfi does not.

These platforms offer some of the same security features, including:

  • two-factor authentication (2fa): requires two forms of identification, such as your password and a code sent to your phone, to log in to your account. blockfi allows users to enable 2fa, and coinbase requires it.
  • address whitelist/allow list: ensures that cryptocurrencies can only be withdrawn to approved wallet addresses.

blockfi and coinbase have had security incidents in the past, including a coinbase hack in 2021 and a data breach in 2022 involving blockfi. To their credit, both are proactive in fixing security issues and neither has allowed their customers to lose funds. when hackers stole crypto from coinbase customers during that 2021 attack, the exchange reimbursed them.

final shot

For most cryptocurrency investors, coinbase is a better option than blockfi. offers many more cryptocurrencies and features, including simple and advanced trading options, great educational content, and opportunities to earn interest on your holdings. All in all, it is an exchange that can work for almost everyone, from beginners to experienced traders.

blockfi’s main attraction is its blockfi interest accounts, but they are no longer available to us. investors if you are not a u.s. resident, then blockfi is worth checking out to earn interest. it’s easy to use and you can charge interest on any of the cryptocurrencies it offers automatically. But for those in the US, BlockFi just doesn’t have much to offer compared to Coinbase.

See also: 7 Ways to Buy Bitcoin with Cash in 2022 – A Complete Guide

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