Exchange Account Options for Beginners
When it comes to options for beginners wanting to get a start into buying and selling crypto in a vanilla way, you will come across two fiat portal exchanges to get you to buy your first cryptocurrencies. Coinbase and Gemini are one of the two well established crypto fiat exchanges where you can make your first purchases and dive into the volatile space of crypto. It is however, best to keep in mind what options and variety pros and cons you can weight before you decide who will be your designated fiat gateway from here on out. Today we will discuss the key differences of both these portals as well as what they have to offer to you as a beginner and in what ways you can get started into the space.
Coinbase is as simple as it gets, being that it is one of a kind, brand established fiat portal exchange that gets your first foot in the door. You can easily connect your Bank account and credit or debit card in order to buy the regular staple coins such as Bitcoin, Ethereum, Litecoin and much more to be determined as more newer alt coins are on boarded on their platform. You can also use Pay pal as a method to purchase the currencies directly without any delay. However, this will come at a partially hefty cost when it comes to fees. Unlike Gemini, when we compare the rates for purchasing, it is made clear that Coinbase charges significantly more compared to whenever you purchase from Gemini. This will be one of this Cons or a trade off when it comes to easy access into just wanting to purchase crypto.
It’s as easy as it gets, all you must do is verify your account with your email and select whatever credit card or ACH routing account as a method payment and you are good to go to enter to buy Cryptocurrency Assets. You will receive the agreed upon amount of cryptocurrency that you purchased after a few days of processing time via email confirming the pricing you had purchased or whether if you used Credit card, it will be instant.
The layout is very user friendly and very self-explanatory towards the point of making it very simple and easy as a click of a few buttons in the picture above of how quickly you can get it stored into your Coinbase crypto wallet. Credit cards or Debit Instantly deposit the market rate price of the currency you are trying to purchase as quick as the click of the buy button. Another payment method would be the direct ACH transfer from your bank account in which it typically takes 5-7 business days to get the crypto deposited. The upside in this option of payment is that you are getting a significant reduction in fees. However, this is at the cost of your purchase stuck in a lock in rate that will fluctuate till you get it deposited. The problem with this is that you will be at risk of losing value very quickly if in the event of volatility towards the downside persists and you are stuck at the whims of the market and the exchange due to it being already locked in from your purchase confirmation. This also can run towards volatility towards the upside where you make money on any volatile direction towards the upside. The key goal however is to be able to be liquid as quick as possible so you can act if in any risk that is involved and not have your crypto stuck in limbo. To each there own but this is the main points to keep in mind when purchasing in those two methods on Coinbase
Buying Cryptocurrencies with a credit card on Coinbase
- Create and verify your account.
- Buy Bitcoin, Ethereum, and Litecoin at their set price and receive it instantly.
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Buying Cryptocurrencies via Bank Transfer on Coinbase
- Create and verify your account.
- Buy Bitcoin, Ethereum, and Litecoin at their set price.
- You will receive the agreed upon amount of cryptocurrency that you purchased after a few days of processing time.
When it comes to Gemini, the Winklevoss twins certainly did a great job in creating a direct competitor against Coinbase giving another option that is cheaper for Crypto traders to enter the space without breaking the bank of constant buying and selling. One of the biggest key differences would be that unlike Coinbase, the divergence begins in that Gemini is actually a proper exchange and not just a fiat portal. You can actually as a U.S citizen buy in but also trade against other users all in one making it more of streamlined experience and less of a hassle of waiting for confirmations more or less than Coinbase as you are just holding in it and can’t trade against other users but rather the exchange itself since it is just a depository for which they auction coins such as Bitcoin or Litecoin at a premium. Gemini, only offers direct ACH or wiretransfers as the deposit method for fiat, meaning you can’t use traditional debit or credit cards to make a purchase nor use PayPal.
Just like Coinbase, all you must do is verify your email with the account along with connecting your selected ACH method banking account to have a direct fiat connection to purchase on the exchange and you are good to go.
Gemini falls somewhere in the middle between traditional exchanges and Coinbase.
While Gemini is a cryptocurrency exchange, they allow users to immediately trade for cryptocurrency when depositing via bank transfers. In other words, you can begin trading before your deposit is fully processed. However, you won’t be able to withdraw your cryptocurrency before your deposit is fully processed.
Buying Cryptocurrencies via Bank Transfer on Gemini
- Create and verify your account.
- Deposit fiat currency to the exchange, that will be instantly available for trading.
- Place an order on the exchange’s market.
- When your order has filled, you receive your cryptocurrency.
- You can withdraw your cryptocurrency once your bank transfer has been fully processed.
Verification on Gemini
When it comes to both Gemini and Coinbase, due to United States AML (Anti-Money Laundering) laws and the need to track and tax individuals, it is required for anyone who signs up to give out personal information and be allowed to trade. Think of it being similar to opening a brokerage account for trading stock. Regulatory bodies oversee and have both these companies follow the law to be compliant. This in a way helps to garner trust for these two exchanges and legitimizes the operations of both companies.
Coinbase does not have set limits on the site for new users, but it varies based on how much verified personal documents, purchases or account age relates to the account. Whereas Gemini limits bank transfers up to $500 a day. Both companies allow large sum wire transfers, however they require either direct contact to apply for this method.
Rest assured that both companies segregate customer funds from their own operational funding along with industry standard procedures of protecting crypto wallets securing the coins offline within cold storage.
If you are trying to save the most when it comes to fees, Gemini is the best option, Coinbase I will have to personally denounce due to the eye gouging charges that take place.
Who is the winner?
That is truly up to you as a trader, if you are looking to quickly buy a cryptocurrency without too much limitation and do not mind the fees associated with quickly purchasing, then we would recommend Coinbase to get the job done. However, if you are looking for a significantly lesser cost in purchasing fees associated, but also would like to trade with other retail investors, Gemini will be an all in one combo to fulfill that need. Based off personal experience however, at the end of the day in my opinion Gemini would be best fit all around to sustainably not break the bank but also get your foot in the door in the volatile space of crypto. Regardless, as traders we must look for what is best for us as individuals but also what keeps us liquid enough to maneuver and navigate as best as we can without regulatory limits hindering our assets along with providing all the options needed to take advantage. To all CryptoCue traders and beginners, hopefully this information will help you weigh your options for choosing between these two companies to access the crypto asset space.