A crypto exchange is an enterprise that allows its users to trade fiat into cryptocurrency and various digital assets and vice versa for a fee. It provides its users with the ease of matching the counterparty of a trade. It is a marketplace where buyers are matched with sellers at a price convenient for both. Coinbase, Binance, and Kraken to mention a few are the exchanges within the crypto space. So here we have focused on clearly distinguishing between Kraken Vs Coinbase.
These exchanges offer unique market products and services to secure a market share of the entire cryptocurrency ecosystem, from staking for various percentages, margins, perpetual contracts market for various fees, coin listed, location availability, etc. These varying services offered raise preferences amongst users.
In this article, we would discuss two major US exchanges its similarity, difference and why one is preferred over the other
The financial technology firm Coinbase Global, Inc. Founded in 2012 by Brian Armstrong offers complete financial infrastructure and technology. Its main goal is to create the crypto-ecosystem, a decentralized, transparent financial system that makes use of digital assets created with the aid of blockchain technology.
Furthermore, with the help of its platform, over 100 countries’ worth of retail users, 7,000 institutions, and 115,000 ecosystem partners can participate in the crypto-ecosystem. It provides a primary financial account for retail consumers to store, earn, spend, and use cryptocurrency.
It offers a one-stop shop for enterprises, money managers, and hedge funds to access the cryptocurrency markets using cutting-edge trading and custody technology. The company offers platform-based technologies and services that enable developers, merchants, and asset issuers to create applications that make use of crypto protocols, take part in crypto networks, and safely accept cryptocurrency as payment.
Coinbase Pros and Cons
Kraken a San Francisco-based has been in business since 2011 and is regarded as one of the leading bitcoin exchanges worldwide. Furthermore, Kraken consistently ranks among the top 10 cryptocurrency exchanges globally for both Bitcoin and trading volume across all cryptocurrencies offered, and it has the biggest euro volume of Bitcoin trading of any exchange.
Meanwhile, Kraken has generally been seen as being good, but not without area for improvement, in terms of the actual trading software via which bitcoin buyers and sellers complete transactions. The exchange has been known to experience issues when traffic and order volumes are at their highest.
Pros and Cons
Similarities Between Kraken Vs Coinbase
Coinbase and Kraken are both known to have stringent KYC (know your customer) processes to comply with the laws of the country they operate. It’s a known rule for businesses to know the customer, Coinbase however has been the standard for KYC as users are known to submit ID cards, facial recognition, etc.
Both exchanges have well over 120+ tradeable coins on the exchange, this ranges from meme coins, small market-cap coins, and big-cap like bitcoin.
Both exchanges offer staking opportunities for their users, users can stake their coins on the exchange for a percentage after the stipulated time. Coinbase and Kraken offers 24/7 customer support, and live chat to assist their customer overcomer issues
Differences Between Kraken Vs Coinbase
Security is of utmost importance when selecting a crypto exchange because crypto platforms are infamous for experiencing spectacular hacking occurrences.
For security, Coinbase provides two-factor authentication. Despite improving its security measures, Coinbase has experienced many hacks. Hackers stole information from at least 6,000 Coinbase users in 2021. A weakness in the company’s account recovery procedure was made public by unauthorized individuals.
Kraken has never experienced a significant hack, but some users have posted on online forums about losses brought by such hacks. Servers at Kraken are housed in safe cages and are constantly watched over by armed guards and video monitors. Both two-factor authentication and encrypted data transport are common.
#2. Trading fees
Coinbase the largest trading exchange, trading more than 150 cryptocurrencies. Coinbase fees can be confusing and higher than some competitors, charging a 1% transaction fee for all cryptocurrency transactions while, Coinbase Pro users have a 0.6% and 0.4% taker and maker fee respectively for users with less than $10,000.
On the other hand, Kraken users pay a 0.95% transaction fee for cryptocurrency transactions and 1.5% for its stablecoin transaction. Kraken pro users with less than $50,000 pay transaction fees of 0.16% and 0.26% for maker and taker fees respectively.
#3. User experience
Coinbase with years of experience and a great team provides a great user experience, the exchange is simple to use and its interface is seamless. It offers automated crypto purchases for users who would prefer a passive approach to crypto
The Kraken user interface comes with more friction; its advanced verification process could take days for feedback from the team.
#4. Exchange wallet
While Kraken doesn’t provide a cryptocurrency wallet, it does provide cold storage, which allows you to keep your money offline. Kraken keeps all of its reserves in place so that you can withdraw your money right away.
For keeping all of your digital assets, Coinbase offers a self-custody bitcoin wallet. However, you are free to select a different wallet from a third party. Your Coinbase assets are kept in off-site, cold storage, similar to Kraken.
#5. Staking and it Returns
Margin trading is available to American investors at Kraken. This makes it possible for you to borrow money and use your existing assets as security to buy cryptocurrency.
Margin lending makes it possible for gains and losses to be increased if asset prices fall considerably. For qualified traders, futures trading is also available on Kraken. The best users of these features are seasoned, risk-tolerant investors. Additionally, staking is offered at Kraken for suitable coins like Ethereum (ETH) or Cardano (ADA).
Users of Coinbase have various options for generating rewards and interest on their bitcoin holdings. Several cryptocurrencies, including Ethereum, Cardano, Tezos (XTZ), and Algorand (ALGO), to mention a few, are available for staking on the site.
As users finish lessons on the platform’s instructional portal, they can receive incentives. Coinbase likewise gamifies its educational portal.
Frequently Asked Questions About Kraken Vs Coinbase
Which is better, Kraken, Binance? Which is better, Kraken, Binance, or Coinbase?
Fees. Kraken and Binance both use the maker-taker fee structure, offering much lower fees than other popular platforms such as Coinbase, with maker-taker fees ranging from 0% to 0.26% versus Binance’s 0% to 0.10%
Is Kraken preferable to crypto.com?
Compared to Crypto.com, Kraken provides users with a much smaller selection of cryptocurrencies. Both exchanges provide all of the popular coins, including USDT, Ethereum, and Bitcoin. From the perspective of supported coins, Crypto.com is the superior exchange because it offers a far larger selection of cryptocurrencies than Kraken.
Kraken or Coinbase Pro is more affordable.
Fees. In terms of fees, Coinbase Pro charges between 0% and 0.5%, while Kraken charges between 0% and 0.26%. Kraken thus wins the race. Overall, both platforms provide fee structures that are competitive and compensate market makers for bigger monthly trading volumes.
Putting all that has been outlined into context, it’s proper to say that Kraken and Coin base indeed have their specialties as two different entities. Right from their overview, down to their pros and cons entail all there is to know about these cryptocurrency marketplaces.
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