With the introduction of Binance.US to the United States market in 2019, the competition among exchanges has been heating up. Although exchanges that started outside the US have historically struggled to penetrate the US market due to the regulations, compliance, and branding difficulties, Binance should not be underestimated.
Throughout the rest of this article, we will leave no stone unturned when comparing Coinbase Pro to Binance US. Everything from trading fees, trading volume, and asset availability will be discussed throughout the article.
Table of Contents
Background & Origin
Availability in the US
Let’s not waste another moment. It’s time to compare!
1. Background & Origin
Every champion needs an origin story. In the cryptocurrency market, philosophies can drive adoption, innovation, and sustainability. When it comes to origin stories, there are few that compare to the lore around Coinbase and Binance.
Both of these exchanges were founded by driven entrepreneurs who were ready to take risks to try something new.
Today, Binance US is a healthy competitor to Coinbase Pro. Although they may service fewer traders, the exchange is building momentum. If the meteoric rise of Binance in 2017 taught us anything, it’s that we shouldn’t underestimate the growth of a determined team.
Riding on the back of the enormous Binance brand, Binance US has the potential to disrupt the US crypto market.
2. Trading Fees
One of the most prominent differences between Coinbase Pro and Binance US is the way each exchange structures their trading fees. Although both exchanges might be targeting the same market, the contrast between each of their trading fee structures is stark.
Over the last year, Coinbase Pro has surprisingly increased its trading fees. The hardest-hit individuals are those that only execute a small volume of trades each month. Customers trading less than $10k will pay a shocking 0.5% in trading fees. This is among the highest of any exchange in the cryptocurrency market.
Unfortunately, the fees charged by Coinbase Pro don’t get competitive with other top cryptocurrency exchanges until we reach volumes in excess of $50M. Since 99.99% of people don’t fall into that category, its disappointing to see Coinbase Pro go a direction that severely impacts smaller traders.
Out of all the US-based exchanges, Binance US has one of the most (if not the most) generous trading fee tier structures.
Starting off at a base rate of 0.1% for both maker and taker trades, customers can instantly save 25% by paying fees with BNB. This free feature drops your trading fees down to 0.075% with the only requirement being the holding of enough BNB to pay for the fees.
Beyond the great starting rates, Binance US continues to drop the rates based on a customer’s 30-day trading volume or BNB balance. The higher tiers pay as little as 0% maker fees and 0.015% taker fees. The Binance US fee structure is unprecedented in the cryptocurrency market.
The Binance US trading fees are far superior to Coinbase Pro in every way possible. Binance US is both more friendly towards small traders who don’t expect to execute more than $50k in trading volume, as well as whales who plan on executing north of $1B in trading volume each month.
Every trader would fair better with the trading fee structure supported by Binance US.
3. Asset Selection
Before moving funds to an exchange, many traders will be wondering what assets are available for trading. The available assets will determine how investors can allocate their capital. Investors in the crypto market have largely shown that they are willing to go to exchanges that have the largest variety of assets.
At the time of writing, Coinbase Pro has 35 assets listed on the exchange.
Each asset listed on the Coinbase Pro exchange is carefully vetted by the Coinbase team. As a result, Coinbase Pro rarely experiences difficulty or backlash from the community when listing a new asset. In addition, Coinbase Pro has rarely been found to delist assets once they have been listed.
When it comes to asset selection, Coinbase Pro has a stellar reputation for picking the assets that have long-term viability in the market. Often, if Coinbase decides to list an asset it can result in a corresponding pump in price, along with the increased exposure to US customers.
At the end of the day, although Coinbase Pro generally lists fewer assets than other exchanges, customers can expect that the assets which are listed are worthy of attention.
Coinbase Pro Asset Due Diligence: 9/10
Coinbase Pro Asset Variety: 5/10
Currently, Binance US has 47 assets listed on the exchange.
Since Binance US launched only a year ago, the instant aggression with listing assets as quickly as possible shows that Binance is determined to bring a wide selection of assets to US customers. This is exciting to see and will further encourage existing exchanges to be competitive with listing new assets.
In contrast to the strict listing processes observed by Coinbase Pro, Binance has been less strict with their selection process. This could be expected as a trade-off for listing assets faster and being strategic with the variety of assets that are available.
Over the coming years, it will be important for Binance US to continue striking a fair balance between listing assets quickly, but still maintaining a high standard for which assets get listed.
Binance US Asset Due Diligence: 7/10
Binance US Asset Variety: 7/10
The race is neck-and-neck between Binance US and Coinbase Pro when it comes to asset listings. Although Coinbase Pro has a stellar reputation when it comes to listing the highest quality assets, Binance US has been on fire when it comes to listing assets quickly and consistently.
Over the course of the next 12 months, we believe Binance US could take the lead in the asset department as they continue to rapidly grow their selection.
4. Trading Pairs
Although the individual assets available on the exchange are important, just as important are the trading pairs that connect the assets. Without convenient trading pairs, traders are forced to execute unnecessary trades to move assets between different cryptocurrencies.
Coinbase Pro has an abundance of trading pairs that network fiat currencies with cryptocurrencies. Many assets will have both BTC and fiat trading pairs to ensure the ease of moving assets in and out of the market.
Unfortunately, there are some oddities with the way Coinbase Pro constructs their trading pairs. Whether intentional or not, trading between two assets could require making as many as 3 trades.
Let’s take for example Loom and Omise Go. Trading between these two assets would require a trade from LOOM -> USDC, then from USDC -> BTC, and finally from BTC -> OMG. This causes excessive fees and reduces the availability of certain assets with an improperly constructed portfolio.
Note: The issue becomes more complicated when factoring in regional restrictions. Since some trading pairs are not available in some regions, it becomes a nightmare for many traders to know which pairs are tradeable and which are not.
Binance US has placed an emphasis on USD trading pairs. Rather than offering a wide variety of trading pairs for each asset, only a few select assets have trading pairs for crypto-to-crypto trading.
Out of the 47 available assets on the exchange, only 7 have BTC trading pairs. Paired with a lack of many other common quote currencies, this makes it exceptionally hard to build a portfolio of assets that don’t trade with fiat.
No matter how you look at it on Binance US, you almost certainly need to trade between a fiat-to-crypto market.
Since the intention of cryptocurrency is to replace the traditional monetary system, it remains unfortunate that the decision by the Binance US team has been to rely heavily on fiat-to-crypto trading pairs over crypto-to-crypto trading pairs.
When it comes to trading pairs, both Coinbase Pro and Binance US have major issues. Although Binance US has more assets than Coinbase Pro, the selection of trading pairs is minimal. On the other hand, Coinbase Pro has more trading pairs, but the confusion that is caused due to regional restrictions make navigating the exchange complicated.
Liquidity is the ability for an exchange to process large orders without drastically impacting the price of an asset. Essentially, the more liquid a market, the less value will be lost when executing trades.
Coinbase Pro has historically been regarded as an exchange with exceptional liquidity. The above image was taken from CoinMarketCap, where we can see Coinbase Pro has the vast majority of its trading volume concentrated in Bitcoin, Ethereum, and Chainlink.
When looking at the liquidity rankings provided by CoinMarketCap, we can further see that most of the high-cap assets have liquidity ratings in the 300-600 range.
The methodology for how these liquidity scores are calculated can be found here.
Breaking down liquidity even further, we performed a brief analysis of the trades executed on September 15th, 2020 for the BTC/USD trading pair.
Number of trades: 96768
Number of orders: 43788
Percent orders that had slippage: 26.86%
Percent orders with slippage more than 0.01%: 6.73%
Percent orders with slippage more than 0.05%: 0.41%
Percent orders with slippage more than 0.1%: 0.03%
Max percent any order slipped: 0.187%
Coinbase Pro Liquidity: 8/10
Binance US has struggled in its early days to attract significant volume on the exchange. In the above image, taken from CoinMarketCap, we can quickly see that the volume across trading pairs is far lower than on Coinbase Pro.
With lower volume, often we see lower liquidity as well. In the above liquidity metrics provided by CoinMarketCap, this is highlighted by liquidities for each asset generally in the range of 100 to 300.
Breaking down liquidity even further, we performed a brief analysis of the trades executed on September 15th, 2020 for the BTC/USD trading pair.
Number of trades: 9191
Number of orders: 4680
Percent orders that had slippage: 30.00%
Percent orders with slippage more than 0.01%: 15.64%
Percent orders with slippage more than 0.05%: 2.31%
Percent orders with slippage more than 0.1%: 0.19%
Max percent that any order slipped: 0.162%
Binance US Liquidity: 3/10
In both the CoinMarketCap metrics and our custom analysis of the trades executed on the two exchanges, we see Coinbase Pro as the clear winner. Coinbase Pro consistently has a higher trading volume, higher liquidity, and lower slippage than Binance US.
6. Availability in the US
Due to the strict regulatory and compliance requirements from many states in the US, trading cryptocurrency on Coinbase Pro and Binance US is not available in every state.
Although Binance US has only recently launched in the United States, they have already managed to become compliant in the majority of states. However, there are still a number of states from which customers would not be able to register and begin trading. Binance US is currently not available in the following states:
Binance US Availability: 4/10
Unlike Binance US, Coinbase Pro has been available for trading in the United States for over 5 years. Over this time, Coinbase has become compliant in nearly every state to allow customers to trade cryptocurrency.
Coinbase Pro is currently not available in Hawaii.
Customers come to cryptocurrency exchanges to trade, so at the end of the day, exchanges need to have the trading features necessary for investors to run effective trading strategies.
Since Binance US is based on the legendary set of trading features offered by Binance.com, Binance US has set itself apart with a great initial selection of trading options.
We anticipate Binance US will continue to expand into Futures, Margin trading, and decentralized applications in the future.
Basic trading terminal - The basic terminal is a convenient interface for new traders to get comfortable with trading on Binance US.
Advanced trading terminal - An advanced terminal is a place for skilled traders to leverage more complex tools.
OTC trading - OTC trading is available for institutions looking to execute large volume trades on Binance US.
Spot markets - Binance US only offers trading on spot markets.
Limit orders - Limit orders can be placed on the spot markets for any trading pair.
Market orders - Market orders are available for spot markets.
Stop-limit - Stop-limit orders can be automated using the “stop-limit” order type.
OCO orders - One-cancel-the-other orders are available for advanced traders.
Flexible Staking - Flexible staking allows investors to automatically receive staking rewards for holding certain assets on the exchange.
Binance US Trading Features: 7/10
Basic trading terminal - The basic Coinbase Pro trading terminal offers minimal trading functionality. Although it is ideal for new traders, advanced traders will be left wanting more.
Spot markets - Coinbase Pro only offers support for spot markets.
Limit orders - Limit orders can be placed on any available spot market trading pair.
Market orders - Market orders can be manually executed on individual trading pairs.
Stop orders - Stop orders offer protection against flash crashes.
Coinbase Pro Trading Features: 4/10
Coinbase Pro does not offer a significant variety of trading features. Only the most basic trading options are available on Coinbase Pro. On the other hand, Binance US is aggressively adding new features in an attempt to catch up to the core Binance.com platform which has more trading features than any other exchange in the crypto market.
8. Portfolio Management
Trading on an exchange can be a cumbersome process. Monitoring trades 24/7, segmenting funds into multiple portfolios, and automating a strategy is nearly impossible without software to aid in the process.
Coinbase Pro offers a “Portfolios” feature where customers can divide their funds into multiple portfolios. Each of these portfolios can be tracked, traded, and managed individually.
Although a portfolio feature only solves a small portion of the features that most customers want when managing their funds, it’s nice to see that Coinbase Pro is starting down the path of including more portfolio management features.
Coinbase Pro Portfolio Management: 3/10
At this time, Binance US doesn’t support any portfolio management features.
Binance US Portfolio Management: 1/10
Most exchanges don’t support many portfolio management features. As a result, most customers turn towards portfolio management platforms like Shrimpy. On Shrimpy, traders can automate a portfolio strategy, segment funds into multiple portfolios, and track funds over time in a convenient way.
The best part of services like Shrimpy is they allow investors to connect multiple exchanges to a single interface. Portfolios across exchanges can then all be managed through a single set of uniform features.
9. Funding Methods
The first step before trading cryptocurrency on an exchange is to transfer money to the exchange. Most investors will buy their first cryptocurrency with a fiat currency. In this section, we will disclose the fees associated with fiat transactions on Coinbase Pro and Binance US.
Coinbase Pro supports a variety of purchasing options including ACH & wire transfers, debit card purchases, and directly connecting US bank accounts. Generally, the cost for transactions ranges from 1.49% to 3.99%.
Security has always been a top priority for the Binance team. Although there have been a few discrete instances of minor security breaches on Binance, the team has always been transparent, quick to resolve issues, and constantly improving their infrastructure.
In addition to the security measures in place, the SAFU fund has been an incredible standard set by the Binance team. When trading on Binance US, there should be no doubt that your funds are secure.
Binance US Security: 10/10
Security has never been an afterthought for these two exchanges. They both have a history of strong security, aggressive protection of user funds, and doing the right thing in the face of uncertainty whenever it comes to security.
11. User Interface
Elegance in the cryptocurrency market is not always easy to find. Many crypto projects still place the technology first and usability in a distant second.
When it comes to trading crypto, we believe UI & UX are important aspects of providing a usable product. Confusing interfaces can cause customers to take unintended actions or even lose funds. Exchanges should do everything they can to mitigate misunderstandings that could lead to the loss of funds.
Coinbase as a company has always been focused on simplicity, ease of use, and pleasant experiences. We’ve seen this ever since they initially launched the Coinbase online wallet services.
To this day, Coinbase Pro still remains an elegant masterpiece. There are clear user flows, simple designs, and clear instructions at every turn.
Coinbase Pro has become the industry standard for new customers getting into cryptocurrency for the first time. There is no better place to start your journey as a crypto beginner.
Coinbase Pro UI: 10/10
Binance US is based on the globally tested and validated Binance.com exchange design. One of the reasons Binance quickly rose to success was due to the pleasant, simple, and beautifully designed interface.
Depositing funds, executing trades, managing orders, and withdrawing funds are all exceptionally easy to do on Binance US. Rarely will you be lost on Binance US.
Binance US UI: 9/10
12. Final Thoughts
The competition between these two exchanges has been exciting to watch over the last year. Although Coinbase Pro has long been the default exchange for US customers since 2015, Binance US has a shot of dethroning Coinbase Pro by moving quicker than the competition.
Crowning the King
At the end of the day, there is no contest. Coinbase Pro is easily the best cryptocurrency exchange for US customers. However, that can change in an instant. Binance US is moving fast and Coinbase Pro must be feeling the heat.
If Binance US continues to list assets quickly, attract liquidity, and expand the selection of trading features, we anticipate Binance US will overtake Coinbase Pro by this time next year.