Coinbase vs. Coinbase Pro: Which Is Right for You? | The Motley Fool (2024)

Coinbase is one of the most well-known and user-friendly cryptocurrency exchanges. In 2018, it launched an advanced platform for professional traders. Coinbase Pro was created to provide more trading tools, and came with lower fees, so it quickly became a popular alternative to the exchange's default platform.

This separate platform won't be around much longer. Coinbase launched an advanced trade feature in June 2022 and plans to discontinue Coinbase Pro by the end of the year. In this breakdown of Coinbase vs. Coinbase Pro, we'll cover what made them different and what you can expect from the new advanced trade option.

Coinbase Pro used to have much lower fees than Coinbase, but that's not the case anymore. The advanced trade tool on Coinbase has the same rates as Coinbase Pro -- ranging from 0% to 0.60% per order. However, the simple trade tool on Coinbase is more expensive, so it should be avoided.

The fee structure used for Coinbase Pro and advanced trades on Coinbase are based on your 30-day trading volume. It also uses a maker-taker model. Orders that make liquidity, which means those that aren't filled immediately, incur maker fees. Orders that take liquidity, meaning those that are filled immediately, incur taker fees.

Here are the fees for Coinbase Pro and advanced trades on Coinbase:

Simple trades on Coinbase cost quite a bit more. On orders of about $205 or more, the exchange charges a variable percentage fee that ends up being a little less than 1.5%. Smaller orders have flat fees as follows:

• Up to $10: $0.99
• Up to $25: $1.49
• Up to $50: $1.99
• Up to $205: $2.99

To give a quick example, let's say you want to buy $1,000 worth of cryptocurrency. If you place that order on Coinbase Pro or as an advanced trade on Coinbase, you'd pay between $0 and $6 in fees. If you placed it as a simple trade on Coinbase, you'd pay $14.68.

Coinbase has a very impressive selection of over 200 cryptocurrencies, much more than most other exchanges. Both Coinbase and Coinbase Pro offer the same cryptocurrencies, so there's no difference between the two platforms here.

Whether you want to trade market leaders or smaller types of cryptocurrency, you'll have plenty of options to choose from. Coinbase is also proactive about expanding its roster and regularly adds new cryptocurrencies. Here are a few of the more popular ones you can trade on Coinbase and Coinbase Pro:

• Bitcoin (BTC)
• Ethereum (ETH)
• Cardano (ADA)
• Solana (SOL)
• Polkadot (DOT)

RELATED: See The Ascent's Guide to Cryptocurrency Availability on the Top Exchanges.

By default, Coinbase and Coinbase Pro store your cryptocurrency in custodial wallets. With this type of wallet, another party controls the private keys to your crypto. If you have an account on each platform, you'll also have two separate custodial wallets, one on Coinbase and the other on Coinbase Pro. You can transfer funds between the two platforms free of charge.

Coinbase also offers a free hot wallet, Coinbase Wallet. A hot wallet is a digital wallet you can download as an app on your computer or phone. If you want full control over your crypto, you can download Coinbase Wallet and store it there. There are also plenty of other quality crypto wallets available.

SEE MORE OPTIONS: Check out The Ascent's list of the Best Crypto Wallets

Coinbase is one of the best cryptocurrency exchanges when it comes to security. Since Coinbase and Coinbase Pro have the same security features, they're equal in this regard, and they're both among the safest places to buy crypto.

Protections offered by Coinbase include:

• Two-factor authentication (2FA): Coinbase requires that account holders use 2FA. With this feature enabled, you must provide two forms of authentication to access your account, such as entering your password and a code sent to an authenticator app on your phone.
• Encrypted data: Coinbase follows payment industry best practices for data encryption. The exchange's website traffic runs over encrypted SSL, and its wallets and private keys are stored using AES-256 encryption.
• Address whitelisting: This optional security feature only allows crypto withdrawals to wallet addresses you've designated in your address book. It's a good way to prevent anyone from stealing your funds, even if they gain unauthorized access to your account.
• Cold crypto storage: Coinbase stores over 98% of its customers' crypto funds in cold storage, meaning these funds are kept offline. This is the most secure crypto storage option, as offline storage can't be hacked. Drives and paper backups are distributed in safe deposit boxes and vaults around the world.
• Insurance for online funds: Coinbase maintains an insurance policy for crypto funds kept in hot (online) storage that protects digital assets against losses from theft, including cybersecurity breaches. Cash deposits of up to $250,000 per individual are covered by FDIC insurance, the same type of insurance that protects deposits with major U.S. banks.

It's the customer's responsibility to use a strong password and maintain control of their Coinbase login credentials. Coinbase's insurance policy doesn't cover losses from unauthorized account access due to a breach or loss of your credentials.

In the matchup between Coinbase and Coinbase Pro, there's a clear winner. Because Coinbase Pro is on the way out, you're better off sticking to the standard Coinbase platform.

There used to be benefits to placing orders on Coinbase Pro, including its lower fees and advanced trading tools. Now that Coinbase has integrated these features into its advanced trade tool, Coinbase Pro doesn't have any advantages.

You can now do everything on Coinbase, which is a big improvement from the days when investors had to switch between platforms. The one thing to remember is that fees on Coinbase depend on the trading tool you use, and advanced trades carry much lower fees than simple trades.