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KuCoin and Coinbase are both well-known cryptocurrency exchanges with a lot to offer. But how do they compare in terms of fees, security, available cryptos, and other factors? We look at KuCoin vs. Coinbase side by side to see how the two platforms stack up.
The biggest issue for potential U.S. KuCoin customers is that using the service is at best a legal grey area. KuCoin has an optional know your customer (KYC) process, which U.S. users cannot complete due to the site's geographic restrictions.
When you buy cryptocurrency there are three main types of fees to be aware of:
Every platform has a different fee structure, so before you set up an account, think about how you plan to deposit money, how often you want to trade, and how you will make withdrawals. For example, if you want to keep your assets in an external wallet, check out the costs involved in doing this.
Coinbase has two platforms, one that's designed for beginners and Coinbase Pro, which is aimed at more experienced traders. Trading fees are much lower on Coinbase Pro, so if you plan to trade even semi-regularly, it's a good idea to learn how it works.
Let's take a look at how these three platforms compare:
It is free to deposit cryptocurrency on KuCoin and this does not require KYC approval. However, the only way for U.S. users to buy crypto on the platform with fiat money is via third-party transfers such as simplex or banxa. KYC-verified customers from other countries may be able to deposit money via bank transfer, depending on where they live.
Before we get into the trading fees, let's say you bought $500 of Bitcoin (BTC) using one of the third-party apps. Pay attention to how much BTC you'll receive and check it against the going rate. For example, we only got $480 worth of Bitcoin on one of the apps, which is essentially a 4% fee.
Once you've got crypto assets on the platform, the trading fees are lower than a lot of exchanges, including Coinbase. KuCoin uses a maker-taker system and discounts fees if you pay with and hold its native token, KCS. Level 0 (the entry pricing tier) charges a maker-taker fee of 0.1%. Fees are also slightly higher for less common cryptocurrencies.
Coinbase makes it extremely easy to convert dollars into Bitcoin or any other popular crypto. However, it isn't so easy to understand how much you're paying in fees. Coinbase charges depend on your payment method and the transaction amount.
For example, to buy $500 of Bitcoin by debit card, you'd either pay a 3.99% processing fee or a $2.99 set fee -- whichever was higher. In this case, the $19.95 processing fee.
You'll also pay an unspecified spread (which should be around 0.5% of each transaction) -- which is built into the rate quote you see before you buy.
Fees on Coinbase Pro are not only lower than on the main platform, but they are also more transparent. For starters, you can deposit money via bank transfer for free.
To trade, you'll pay a maker-taker fee which decreases for higher monthly trading volumes. The basic level for people who trade less than $10,000 a month, charges a maker-taker fee of 0.5%. So it would cost just $2.50 to buy the same $500 worth of Bitcoin.
For anyone who wants to buy using fiat money, Coinbase Pro comes out ahead in terms of fees.
One of the main reasons people choose KuCoin is that it has a lot of smaller tokens that are harder to buy on other platforms. At the time of writing, there were over 650 cryptocurrencies on the platform, but it lists new coins almost every day. In comparing KuCoin vs. Coinbase, KuCoin wins the available cryptocurrency section.
Coinbase's policy is to list as many coins as it is legally able to. However, its range of cryptocurrencies is much more limited because the platform is fully licensed in the U.S. It has about 90 tokens available for U.S. customers. These include popular coins such as Bitcoin, Ethereum (ETH), Cardano (ADA), Dogecoin (DOGE), and Solana (SOL). It trades almost all of the top 50 tokens by market capitalization.
Both KuCoin and Coinbase operate custodial wallets for their customers. If you keep your coins in a custodial crypto wallet, the exchange manages the keys to your crypto. This means your assets are at risk in the event of a platform hack, but it also means the platform will help if, for example, you forget your password.
Some people prefer custodial wallets because they don't want to worry about things like safeguarding their passwords. Others want total control of their crypto assets, which is why they move them to an external non-custodial wallet.
If you have an external hardware wallet (one that's not connected to the internet) or a hot wallet, both exchanges will let you move funds into it. But they'll both charge withdrawal fees too.
Coinbase has a separate, standalone Coinbase Wallet that's even available to people who don't have a Coinbase account. It's easy for Coinbase customers to connect to their Coinbase Wallet. KuCoin does not have a separate wallet feature.
Security is important when you're entrusting your money to a cryptocurrency exchange. Look out for things like cold storage (keeping funds offline where they're difficult to hack), third-party insurance, and good user-level security features.
Coinbase keeps 98% of funds in cold storage and has third-party insurance to give extra protection. It also lists various other features on its site, such as background checks on employees and paper backups stored in vaults in various locations.
KuCoin partners with a crypto asset custody platform called Onchain Custodian to ensure the safekeeping of its assets. Like Coinbase, it also has third-party insurance. This deal helped considerably when KuCoin was hacked in 2020. It recovered a large portion of funds and the insurance covered the rest, so customers did not lose any of their cryptos.
No crypto exchange is right for everyone. KuCoin and Coinbase are two very different products that will appeal to different types of investors.
Coinbase is a great option for new crypto traders as it's extremely accessible and has some great educational resources. Most importantly, Coinbase is available in every U.S. state except Hawaii. It is a solid and reliable crypto exchange.
KuCoin's main benefits are closely connected to its biggest weakness. The fact that U.S. users can't get verified means KuCoin can offer a wider range of tokens and advanced crypto trading tools like margin. It also offers a lot more ways for customers to earn passive income on their crypto than Coinbase. However, U.S. residents should be very cautious in using an unlicensed platform.
In terms of fees, KuCoin's low trading fees are offset by the high cost of using fiat currency to buy crypto. The trading fees may be slightly higher on Coinbase Pro, but clients can deposit money for free. As such, KuCoin might work out cheaper for frequent traders who already have cryptocurrencies ready to trade. Coinbase Pro might be less costly for someone who wants to make more frequent dollar deposits.
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