Kraken vs. Coinbase

Kraken vs. Coinbase: At a Glance

Kraken vs. Coinbase: Ease of Use

Kraken is designed for more active traders, giving advanced users more options for buying, selling, and trading crypto than Coinbase. Kraken’s user interface does feel somewhat dated, and crypto newcomers may feel lost when trying to execute their first trade. For advanced users, Kraken offers options trading, futures trading, and access to margin trading as well.

To sign up for Kraken, you can create a free account using your email address and a password. After you verify your email address, you must secure your account with two-factor authentication. To deposit funds, you'll need to go through advanced verification, which includes submitting a picture of your photo ID, proof of residence, and your Social Security number. From there, you can fund your account through your digital wallet or through ACH or wire transfer.

Users can sign up for Coinbase with an email address and password. Before buying or selling crypto, you will need to verify your identity with a government-issued photo ID by uploading a picture of it to the app or website. When verified, you can connect a bank account or credit card to immediately begin purchasing crypto.

Kraken vs. Coinbase: Security

Kraken and Coinbase both offer robust security features, making them two of the most secure places to buy, sell, and store crypto assets. Here are a few of the security options available on each platform:

Kraken Security Features

Whitelisting approved addresses: Kraken requires all withdrawal addresses to go through its verification process, which restricts access to any external address that is not approved. 

Two-factor authentication: Kraken requires two-factor authentication (2FA) via Google Authenticator. SMS account recovery is disabled to avoid hacking via phone. 

U2F security via hardware key: Kraken allows users to secure their account further is a U2F hardware key for offline storage of their crypto access keys.

Global settings lock: Kraken has a global settings lock feature that will instantly freeze your account settings for a period of time, anywhere from one to 29 days. This helps prevent any access or changes to your account when you are away from your account.

Coinbase Security Features

Two-factor authentication: Coinbase offers 2FA via SMS or the Google Authenticator app. This helps secure access to your account by requiring a time-sensitive six-digit passcode. 

Cold storage and crypto vaults: Coinbase keeps 98% of all crypto balances in “cold storage,” meaning the assets are stored in hardware that is not connected to the internet. 

Coinbase also offers a cryptocurrency vault, further securing your stored digital assets. These vaults can be set up to require multiple user approvals before funds are withdrawn. They are also time-locked, meaning that if all approvals for the transaction are not completed within 24 hours, the withdrawal is canceled.

Built-in wallet: Coinbase offers the Coinbase wallet for storing your cryptocurrency. It is protected with a password and biometric access controls. It also has an encrypted 12-word recovery phrase protecting your assets. It also allows users to store and trade ERC-20 tokens.

FDIC insurance (up to $250K): Coinbase offers Federal Deposit Insurance Corporation (FDIC) insurance on USD (U.S. dollar) deposits. This insurance is similar to a traditional bank's, insuring up to $250,000 of deposited USD funds. 

Kraken vs. Coinbase: Features

Kraken and Coinbase both offer users a way to purchase and trade crypto, but they go about it in very different ways. Though some of their features are the same, here are a few of the unique features on each platform:

Kraken Unique Features

Huge variety of trade options: Kraken offers a large selection of trade types for advanced users. Here is a quick list of just some of the trade options available:

• Limit order
• Market order
• Settle position order
• Stop limit order
• Stop market order
• Margin trading
• Futures trading

Advanced charting: Kraken allows users to turn on “Advanced Markets View” to view live order book transactions and charts with multiple indicator overlays and build a watchlist.

API keys: Kraken gives users access to their API keys, allowing third-party apps to integrate with Kraken. Users can also control access to these API keys on a detailed level, further securing their accounts.

OTC investor service: Kraken caters to high-dollar investors who are getting into the crypto space. They offer a 1:1 white-glove service to help investors make substantial investments in Bitcoin and other cryptocurrencies off the main exchange. They offer market-expert consultations and reporting and help facilitate the trading and secure storage of large crypto purchases.

Coinbase Unique Features

Educational resources (+ bonuses): Coinbase has user education for helping beginners learn about cryptocurrency. These short videos teach users about a certain cryptocurrency project to get them familiar with it, and some of them will give out bonus crypto to users who complete a quiz.

Newsfeed: The Coinbase website and mobile app have up-to-date news articles from various resources built into their platforms. If you click into any cryptocurrency, you will see news articles specific to that currency.

Alerts: If you want to stay up to date on current price moves, you can create a watchlist to track when there are large swings in price.

Kraken vs. Coinbase: Currencies

Kraken and Coinbase both have similar access to the top cryptocurrencies on the market, though Kraken does offer a few more. Kraken currently offers 211 cryptocurrencies on its exchange, while Coinbase offers 306. Each exchange regularly adds to its listed crypto offerings.

Both platforms allow you to purchase cryptocurrency in dollar amounts, allowing you to buy fractions of coins. Coinbase has a $2 minimum order. Kraken, on the other hand, measures its minimum purchase amount in the native token. For example, the minimum Bitcoin purchase amount is 0.0002 Bitcoin (BTC). So if Bitcoin's price is $60,000, you can purchase as little as $12 of Bitcoin.

Both platforms support major currencies such as Bitcoin, Ethereum, Uniswap, Cardano, Chainlink, and Compound.

To explore more currencies on Kraken, you can review their supported cryptocurrencies. To view all the tradable assets on Coinbase, check their listing prices.

Kraken vs. Coinbase: Fees

Both Kraken and Coinbase have fairly high fees for buying cryptocurrency. Each exchange charges a transaction fee along with a fee based on the method of payment used. These can add up quickly.

Both platforms charge a percentage fee per purchase transaction. In addition, they also charge extra fees based on the account used in the transaction.

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

Both platforms charge more than most other exchanges to purchase crypto, but Kraken does offer a significant discount for trading one cryptocurrency for others.

Kraken uses a maker-taker fee model based on your 30-day trading volume. When users place an order at the market price that gets filled immediately, they are considered a “taker” and charged the taker fee. When users place an order that is not immediately matched, it is placed in the order book (until a match is found), and they are considered a “maker” and are charged a maker fee when the trade executes.

Here’s how their trading fees break down:

As you can see, users can trade crypto at a significant discount compared to Coinbase, with fees ranging from 0% to 0.26%. If you are an active trader, Kraken is one of the lowest-fee exchanges on the market.

Kraken vs. Coinbase: Access

Both Kraken and Coinbase are available globally with Kraken offered in far more countries worldwide than Coinbase at this time. Kraken is available in over 170 countries worldwide, while Coinbase is offered in just over 100.

However, Coinbase is offered legally in all 50 states in the U.S., while Kraken is only available in 48 states. They are actively working to comply with Washington state and New York state regulatory laws for approval.

Final Verdict

There are several similarities between Kraken and Coinbase. For example, both are U.S.-based companies; both offer a variety of the top cryptocurrencies available; and both are extremely secure exchanges for buying, selling, and trading crypto.

Kraken offers some of the lowest fees around for active crypto traders. With access to advanced limit orders, futures, and even margin trading, advanced users will be right at home using Kraken’s trading tools.

Coinbase is the simplest platform to use for beginners due to its minimalist design and fantastic mobile app. Buying and selling crypto on Coinbase only takes a few clicks, and your digital funds are stored safely at all times.

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

Frequently Asked Questions

Methodology

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

Though Kraken and Coinbase are both very similar crypto exchanges, they each offer a few unique features that cater to their ideal clients. Kraken has been around since 2011, providing users with a secure way to actively trade their crypto. With its low-fee trading structure and advanced trading tools, Kraken is best for experienced cryptocurrency traders. Coinbase is better suited for first-time crypto investors due to its simple interface and user education component. 

However, both of these exchanges charge higher-than-average fees for crypto purchases, so fee-conscious investors may want to look elsewhere.