Coinbase vs Kraken: Which Should You Use?

Centralized exchanges currently offer the most liquidity and the most straightforward way to exchange fiat for crypto. Because centralized exchanges must maintain anti-money laundering (AML) and know-your-customer (KYC) compliance, they often require a good bit of personal information from users. The tradeoff is that centralized exchanges tend to offer more liquidity and trading options than decentralized exchanges (DEXes) and at least the illusion of more protection (of course, we reiterate the oft-repeated advice that traders should not leave any more funds than necessary on exchanges, because unless you own your own private keys, you do not have complete control over your funds). We’ll compare two well-established exchanges available to United States traders: Coinbase vs Kraken.

Which one provides the best experience for traders and investors?

Simplicity

First impressions count. Newcomers to crypto need an intuitive user interface without a steep learning curve.

• Coinbase offers two trading platforms – Coinbase and Coinbase Pro (I’ll call it “GDAX”). Coinbase has a clean, colorful interface that does a great job of easing new users into the space. Also, even though GDAX has more advanced features, it does not intimidate someone new to crytpo or trading in general. Also, Coinbase has a mobile app.
• In contrast, Kraken’s user interface comes across as complex and daunting. Getting comfortable with Kraken’s advanced functionality takes some time, and some new users might not have the necessary patience. And Kraken does not provide a mobile app for trading.

Advantage Coinbase

Advanced features

Newbies want ease and comfort, but seasoned traders demand much more. Let’s look at features for Coinbase vs Kraken.

• Coinbase only permits buying and selling cryptoassets. GDAX allows for fiat-crypto and crypto-crypto trading, but only offers market, limit, and stop orders.
• On the other hand, Kraken allows for those order types and more. In addition, Kraken lets users trade certain currency pairs with leverage, a technique used by many advanced traders.

Advantage Kraken

Trading pairs and volume

Some users choose an exchange based solely on what cryptoassets are available for trading.

• According to CoinMarketCap (CMC), GDAX offers 32 different markets (trading pairs). Users who prefer the simplified Coinbase interface can buy and sell nine different cryptoassets. As far as volume, CMC ranks Coinbase/GDAX as the number 44 exchange by 24-hour volume (as of January 21, 2019).
• Kraken offers 72 trading pairs and ranks 39th among exchanges by 24-hour volume, according to CMC.

Advantage Kraken

Fees

Fees can add up. A smart trader will take into account the costs of deposit, exchange, and trading when picking Coinbase vs Kraken.

• Coinbase users pay for convenience. There’s no fee to deposit USD, but for purchases and sales, Coinbase charges a percentage of 0.5% plus a fee ranging from $0.99 to $2.99 (depending on transaction amount). But if you wait 3-10 calendar days for your bank transfer to clear, you can move your funds to GDAX and enjoy much lower fees. GDAX sets its fees by trading volume. For users with under $10 million in trading volume over 30 days, the taker fee is 0.30% and the maker fee is 0.00%. There is no fee for withdrawing crypto or fiat via bank transfer.
• Kraken’s fee schedule reflects the variety of Kraken users. Kraken charges a small fee for depositing or withdrawing fiat. For example, a deposit or withdrawal of USD via bank wire costs $5.00. The exchange also charges a small flat fee to withdraw crypto (e.g., withdrawing ether costs 0.005 ETH). Trading fees on Kraken also decrease as a user’s trade volume increases. Kraken has eight fee levels for volume under $10 million, ranging from 0.16% maker / 0.26% taker (below $50K volume) to 0.02% maker / 0.12% taker (between $5 million and $10 million volume).

Advantage: Depends on your trading style and volume

Name

What’s in a name? Not much, but why not compare Coinbase vs Kraken on that metric, too?

• The word “coinbase” means the first transaction in a block that allows the block reward to be claimed.
• The word “kraken” means ” legendary cephalopod-like sea monster of giant size that is said to dwell off the coasts of Norway and Greenland.”

Advantage Kraken

Coinbase vs Kraken: The Verdict

Choosing Coinbase vs Kraken depends on what kind of trader you are! If you just want to dip your toes into crypto and buy a little Ethereum or Bitcoin, you might prefer the simplicity of Coinbase. And as you become a moderately experienced investor or trader, you might prefer the lower fees and additional options of Coinbase Pro (formerly GDAX). On the other hand, traders who deal in greater volumes and those with experience dealing with altcoins and with the risks + rewards of leveraged trading might choose Kraken as their preferred exchange. You can sign up for a Coinbase account here, and you can sign up for a Kraken account here.

Regardless of which centralized exchange you choose, you don’t want to miss out on the growing benefits of decentralized exchanges, so check out DEX.AG to find the best prices across leading DEXes!