BlockFi and Coinbase are two of the most reputed cryptocurrency service providers in the US. They offer similar functionalities, such as crypto savings wallets, crypto loans, and real-time crypto trading.
However, there are some key differences between the two platforms. For instance, Coinbase is yet to launch the interest account functionality, but it offers additional services like debit cards and earn-to-learn.
This Coinbase vs. BlockFi review delves deep into the products and features available on the two platforms and which service is better for crypto users.
Let us get started.
[wptb id="12304" not found ]BlockFi vs. Coinbase: Supporting Crypto Assets & LTV
BlockFi supports ten digital currencies and stablecoins. These include six cryptocurrencies and four stablecoins. These include popular cryptocurrencies like BTC, ETH, and LTC and stablecoins like USDT and USDC. BlockFi also supports PAX, PAXG, and GUSD, which you can’t buy on Coinbase.
In contrast, Coinbase supports over 60 cryptocurrencies, ranging from popular cryptocurrencies like BCT and ETH to stablecoins like USDT and USDC to new names like DOGE.
Both BlockFi and Coinbase offer crypto-backed loans. You can borrow cash using your crypto assets as collateral. This way, you can avoid selling your Bitcoin and get cash quickly. Later, you can repay the loan on flexible payment terms and get your crypto back.
BlockFi offers a 50% loan-to-value (LTV) ratio. This means the loan amount you can borrow cannot be more than 50% of your collateral’s value. Suppose you use 1 BTC as collateral. The current price of BTC is around $50,000.
BlockFi offers crypto-backed loans at an interest rate of as low as 4.5%. Therefore, the maximum loan amount you can borrow is 50% of $50,000 – $25,000. The minimum loan amount on BlockFi is $10,0000, and the maximum amount is $100 million.
The interest rate is directly proportional to LTV. Here is how the BlockFi LTV-interest rate relationship looks like:
- 50% LTV – 9.75% interest rate
- 35% LTV – 7.9% interest rate
- 20% LTV – 4.5% interest rate
Also, to sign up on the platform you can use BlockFi referral code to get welcome bonus.
Coinbase, on the other hand, offers up to 40% LTV. So, if you use 1 BTC as collateral and the current BTC price is $50,000, you can get a loan of up to $20,000. The maximum loan amount on Coinbase is $100,000. Coinbase charges an interest rate of 8% on all crypto loans.
Please note that Coinbase allows you only to use Bitcoin as collateral. On BlockFi, you can use Bitcoin, Ether, Litecoin, and PAXG.
Verdict: It’s a tie. Coinbase supports more cryptocurrencies, whereas BlockFi offers a higher LTV and more flexible loan amounts.
BlockFi vs. Coinbase: Interest Account Rates, Lock-in Terms & Payouts
BlockFi and Coinbase both allow you to lend your crypto assets and earn interest.
BlockFi has one of the best interest accounts in the crypto space. You can deposit as little as 0.25 BTC and start earning up to 4% annual percentage yield (APY).
The APY is 4% for cryptocurrencies and 7.5% for stablecoins. The interest accrues every day and is paid out monthly. Though the payout and lock-in period is one month, you can hold your assets for fixed terms to earn greater interest.
Coinbase, on the other hand, doesn’t have a lending system yet. However, it has announced that it will soon be launching interest accounts.
The accounts will allow you to earn up to 4% APY on USD Coin (USDC). Since the product hasn’t yet launched, there’s no information about lock-in terms and payouts.
However, Coinbase has a staking service that allows you to earn up to 5% APY. The following assets are available for staking on Coinbase:
- Ethereum – 5.00% APY
- Cosmos – 5.00% APY
- Tezos – 4.63% APY
- Algorand – 4.00% APY
- DAI – 2.00% APY
- USD Coin – 0.15%
Verdict: BlockFi is the clear winner, as it has a full-fledged lending system and offers interest on ten cryptocurrencies and stablecoins.
Products & Features Comparison: Exchange, Credit Card, and More
BlockFi and Coinbase offer similar products and features; however, there are certain differences both individuals and institutions must realize. Let’s compare the features and services provided by BlockFi and Coinbase.
BlockFi
Let’s first look at the key product offerings of BlockFi
- Interest Account: The BlockFi interest account lets you store your crypto assets for flexible periods and earn up to 7.5% APY.
- Trading Account: Buy and sell Bitcoin and many other cryptocurrencies in real-time to capitalize on the volatility of cryptocurrencies.
- Crypto-Backed Loans: Use your crypto assets as collateral to borrow up to $100 million at interest rates as low as 4.5%.
- Credit Card: BlockFi’s Visa credit card allows you to pay with cryptos.
Coinbase
Coinbase offers a wide range of products and services. Let’s look at the key product offerings of Coinbase.
- Traditional Cryptocurrency Exchange: Buy and sell over 60 cryptocurrencies in real-time. You can either hold them for the long term or take short-term positions.
- Earn and Learn: Coinbase enables you to earn cryptocurrencies by learning about them. For instance, you can earn $3 FET by learning about FET and $10 XLM by learning about XLM.
- Wallet: Coinbase has one of the best self-hosted crypto wallets in the market. You can store all your crypto and NFTs in one place and trade over 500 assets without the need for a Coinbase account.
- Card: The Coinbase Visa debit card allows you to spend crypto and earn rewards. Thousands of merchants worldwide accept Coinbase VISA cards.
- Crypto-Backed Loans: Use Bitcoin as collateral and borrow up to $100,000. Return the amount at your convenience at an interest rate of 8%.
- Private Client: Private Client is a crypto platform developed for family offices, trusts, investors, personal investment vehicles, and ultra-high net worth individuals.
- Coinbase Pro: It is an institution-grade platform with top-notch features for experienced traders.
Verdict: Coinbase is the winner, as it offers more products than BlockFi.
Coinbase vs. BlockFi: Trading Cryptos
Trading cryptocurrencies for the short term is an effective way to earn money from their liquidity. Both BlockFi and Coinbase offer exchange accounts and allow you to trade, buy and sell cryptos in real-time.
Let’s compare the platform performance of the two exchanges.
- BlockFi
BlockFi is primarily a borrowing and lending platform, so it doesn’t offer many trading options. It has an exchange functionality that allows you to buy and sell cryptos. However, there’s no dedicated trading terminal or charts that you can follow for better analysis.
Also, it doesn’t have popular trading products like futures and options. On the positive side, BlockFi doesn’t charge any trading fees.
- Coinbase
Coinbase has two versions: Coinbase and Coinbase Pro. Trading services on Coinbase are similar to BlockFi. You can buy and sell cryptos; however, there is no trading terminal or charts. Coinbase Pro, on the other hand, is a full-fledged trading platform with institution-grade charts and other features.
However, the trading fee charged by Coinbase is quite high (more about it in the next section).
Verdict: It’s a tie. While Coinbase has better trading functionality, BlockFi doesn’t charge any fee.
Loan Origination & Withdrawal Fees
BlockFi and Coinbase have varying fee structures. Let’s compare the fees charged by the two exchanges.
BlockFi charges a loan origination charge of 2% on all loans, regardless of the LTV and interest rate. Coinbase, on the other hand, claims that it doesn’t charge any loan origination or borrowing fee. Both the platforms don’t have any loan prepayment charges.
BlockFi doesn’t charge any fee for buying and selling cryptocurrencies. However, it charges a withdrawal fee depending on the crypto asset.
For instance, the withdrawal fee for BTC withdrawals is 0.00075 BTC, and the withdrawal fee for ETH is 0.02 ETH. BIA clients get one free withdrawal per month.
Coinbase charges fees on several products. Depending on the payment method (bank account or wallet transfer), order size, and market conditions, there may be crypto transaction fees. Coinbase charges a flat 2.49% fee on all Coinbase card transactions. For credit card/debit card transactions, there is a flat fee of 2%.
If you stake your crypto assets on the platform, Coinbase takes a 25% commission. For trades on Coinbase Pro, Coinbase charges a commission of 0.04%-0.50%.
Coinbase also charges a convenience fee based on the amount of crypto in your wallet. Here’s a look into the fee structure:
- $10 or less – $0.99
- $10-$25 – $1.49
- $25-$50 – $1.99
- $50-$200 – $2.99
Verdict: BlockFi is the winner, as it charges fewer fees than Coinbase.
BlockFi vs. Coinbase: Safety & Security Features
BlockFi and Coinbase are both US-based financial organizations that operate under strict regulations and standards defined by the US SEC.
BlockFi partners with Gemini as its primary custodian to protect its users’ funds. The company stores over 95% of users’ funds in multi-signature cold wallets, and withdrawals are subject to manual authorizations. The remaining 5% and kept in hot wallets to support real-time transactions.
In addition, BlockFi implements all the industry-standard security measures, including:
- Multi-factor authentication
- Mandatory KYC
- Robust infrastructure with IP whitelisting and SSL encryption
Coinbase is one of the most secure cryptocurrency platforms in the world. It stores over 98% of users’ funds in multi-signature cold storage wallets. Moreover, all the funds deposited in Coinbase wallets are insured by the Federal Deposit Insurance Corporation (FDIC).
Besides, Coinbase also adheres to industry-standard security practices, including multi-factor authentication, SSL encryption, and IP whitelisting.
Verdict: Coinbase is the winner, as deposits on Coinbase are FDIC-insured.
BlockFi vs. Coinbase: Insurance
As the crypto industry remains at risk of cybercrimes and malicious price violations, insurance has become a priority for crypto users.
BlockFi deposits aren’t subject to FDIC insurance, even though it’s regulated by the US SEC. However, BlockFi works with Gemini to insure deposits at its end. On the other hand, Coinbase is one of the few crypto exchanges insured by the FDIC.
Verdict: Coinbase is the winner, as it is insured by the FDIC.
BlockFi vs. Coinbase: Minimum Deposits & Withdrawal Limits
BlockFi doesn’t have any minimum deposit requirements. However, it has a tiered structure, and the returns depend on the amount of crypto you deposit. BlockFi has three tiers for BTC and ETH and two tiers for all other cryptocurrencies and stablecoins.
BTC tiers on BlockFi are as follows:
- 0-0.25 BTC (Tier 1) – 4% APY
- 0.25-5 BTC (Tier 2) – 1.5% APY
- >5 BTC (Tier 3) – 0.25% APY
Similarly, here are the tiers for stablecoins.
- 0-50,000 USDC (Tier 1) – 7.5% APY
- >50,000 USDC (Tier 2) – 5% APY
Coming to withdrawal limits, BlockFi imposes weekly withdrawal limits of 100 BTC for BTC, 5,000 ETH for ETH, and 1,000,000 for stablecoins.
Coinbase has minimum deposit requirements for staking. You need to have at least 0.1 ALGO, 1 ATOM, or 1 XTZ. There are no minimum balance requirements for Ethereum. Coinbase accounts are eligible for a $25,000 withdrawal per day, whereas Coinbase Pro users can withdraw up to $50,000 daily.
Verdict: It’s a tie, as both the platforms impose certain limits and have minimum deposit requirements.
BlockFi vs. Coinbase: Account Sign-Up Process & KYC
BlockFi and Coinbase offer seamless account signup processes. To sign up for BlockFi, you need to visit the BlockFi website and click on “Get Started.” Thereafter, you need to register your account using your email ID and password and complete the KYC process.
Coinbase has a similar registration process. Head to the Coinbase website, enter your email address and click on Get Started. After registering, you’ll need to complete the identity verification process.
Since both BlockFi and Coinbase are SEC-regulated companies, KYC is mandatory to use the services on their platforms.
Verdict: It’s a tie, as both the companies require you to complete a KYC.
BlockFi vs. Coinbase: Supported Countries
BlockFi offers services in all countries except for nations sanctioned by the US, the UK, and the EU. These include Iran, Iraq, Afghanistan, Sudan, South Sudan, the Democratic Republic of Congo. In the US, BlockFi is available in 47 states, excluding New York.
Coinbase is also available in over 100 countries, excluding a few countries sanctioned by the US, the UK, and the EU. In the US, Coinbase is not supported in Hawaii.
Verdict: It’s a tie.
Is BlockFi Safe?
Yes, BlockFi is a safe and secure crypto platform. It’s regulated by the US SEC and takes industry-standard security measures to provide a safe crypto saving, lending, and borrowing experience to its users. BlockFi also uses Gemini as its custodian to protect users’ funds.
Is Coinbase Safe?
Coinbase is one of the safest and most credible crypto platforms in the world. It implements top-notch security features like cold wallet storage and multi-factor authentication. In addition to being regulated by the SEC, Coinbase is also FDIC-insured.
Conclusion
There is no clear winner between Coinbase and BlockFi, as both the platforms have pros and cons.
Coinbase supports more cryptocurrencies and offers more products, such as private client and debit cards. Also, it’s one of the few crypto platforms insured by FDIC.
On the other hand, BlockFi has superior borrowing and lending functionality. It offers higher LTV, charges a lower interest rate, and gives a higher APY on crypto deposits. BlockFi also charges lower fees compared to Coinbase, which can be a deal-breaker for many users.
In all, both Coinbase and BlockFi are excellent platforms. If you need a highly secure and trusted platform but can adjust with higher fees, Coinbase will be the right pick for you. If features and benefits are your priority, BlockFi will be the right choice.
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