BlockFi vs Robinhood

Two platforms that are getting a lot of attention are BlockFi and Robinhood. BlockFi is a privately owned company established in 2017 and based in Jersey City, New Jersey, with offices in New York, Argentina, Poland and Singapore. Robinhood Market, Inc was founded in 2013. They are a financial services company based in Menlo Park, California. The company is publicly traded on the Nasdaq Stock Exchange under the stock ticker HOOD. Our Robinhood versus BlockFi review examines both platforms so you can make an informed decision as to which platform is better for you.

What is BlockFi?

BlockFi is a centralized crypto banking platform that supports over 40 cryptocurrencies. If you are interested in decentralized crypto platforms take a look at our BTCPop review. A variety of services are available at BlockFi including crypto backed loans and interest earning cryptocurrency accounts. Users can buy, sell and trade cryptocurrencies on the platforms exchange and they even offer a credit card for qualified users.

What is Robinhood?

Robinhood is a financial services company for trading stocks, exchange-traded funds and cryptocurrencies. Although they have been around since 2013, the company didn’t get involved in cryptocurrencies until 2018.

Features

BlockFi Features

• Crypto Exchange: The BlockFi exchange supports the trading of 48 different cryptocurrencies. However, U.S. based users will only be able to trade 15 of the supported cryptocurrencies and only 12 can be withdrawn to or funded from personal wallets.
• Crypto Backed Loans: BlockFi users can borrow up to 50% of the value of their cryptocurrency. Four cryptocurrencies are accepted as collateral; Bitcoin (BTC), Ethereum (ETH), Litecoin (LTC) and PAX Gold (PAXG). The minimum loan amount is $10,000 and loans may be funded in U.S. dollars, USDC or GUSD. The loan term length is 12 months. Interest rates for a cryptocurrency loan vary depending on the Loan to Value (LTV).
• 50% LTV: 9.75%
• 35% LTV: 7.9%
• 20% LTV: 4.5%
• Interest Earning Account: Investors can earn crypto by depositing 48 different digital coins at BlockFi. This is pretty good compared to many platforms but not as many cryptocurrencies as you can earn interest on at MyCointainer. There is no minimum or maximum deposit set by BlockFi to start earning interest. BlockFi interest rates vary depending on the cryptocurrency deposited and range from as low as 1% up to 15%. The following table shows interest rates on 10 popular cryptocurrencies at BlockFi.

• BlockFi Rewards Credit Card: BlockFi’s credit card charges no annual fees. It provides card holders with 1.5% Bitcoin rewards on every purchase they make.

Robinhood Features:

• Cryptocurrency Exchange: Robinhood’s cryptocurrency exchange allows you to buy, sell and trade 16 different cryptocurrencies. While this may not seem like many compared to the 250+ cryptocurrencies supported by the Vauld crypto platform, Robinhood does have plans to add more. There are no minimum limits on cryptocurrency trades at Robinhood but there are some position limits. Position limits are the maximum amount of a cryptocurrency that an investor can buy and hold using Robinhood Crypto. Bitcoin (BTC), Dogecoin DOGE and Ethereum (ETH) have a position limit of $16,000 per digital coin. There is a $5,000 position limit per crypto for Ethereum Classic (ETC), Litecoin (LTC), Bitcoin Cash (BCH) and Bitcoin SV (BSV). There are no fees for crypto trading at Robinhood.

Robinhood does have other features related to trading stocks and exchange-traded funds but for the purpose of our comparison we are including only cryptocurrency related features.

The following table provides a summary of BlockFi and Robinhood crypto platform features.

Currencies

BlockFi supports a total of 48 different cryptocurrencies on their platform. Supported cryptocurrencies are shown in the following table:

All 48 of the cryptocurrencies can be traded on BlockFi’s exchange and deposited into interest earning accounts. Four of them may also be used as collateral for loans. The only fiat currency supported by BlockFi is U.S. dollars.

Robinhood currently supports 16 different cryptocurrencies on their platform. The supported cryptocurrencies are shown in the following table.

These 16 cryptocurrencies can all be traded on Robinhood’s exchange. The only fiat currency supported by Robinhood is U.S. dollars.

Security

BlockFi uses Gemini for storage of their cryptocurrency assets. The majority of their assets are stored offline for increased security while Gemini insures crypto that is stored online. Two-factor authentication (2FA) and whitelisting are other features BlockFi uses to protect their clients.

The majority of the crypto assets held by Robinhood are kept in cold storage. They also carry insurance against losses from theft and cybersecurity breaches. All Robinhood’s accounts are secured with a layer of security that requires users to enter an additional verification code if logging in from a device that is different than the one normally used. While not mandatory, Robinhood encourages the use of two-factor authentication. Sensitive data is also encrypted when it is stored.

Fees

There aren’t a lot of fees to deal with at BlockFi. There are no transaction fees on trades. They charge an origination fee of 2% on BlockFi loans. The first cryptocurrency withdrawal and first stable coin withdrawal every month are free. After that there is a cryptocurrency withdrawal fee as shown in the table.

Robinhood doesn’t charge any fees or commission for using their crypto exchange. While Robinhood doesn’t charge a crypto withdrawal fee, users will still have to pay the network fees.

Ease of Use

BlockFi is an easy site to get started on. To use their services, clients will have to complete a verification process for KYC purposes. The BlockFi interface is intuitive and fairly easy to use and beginners shouldn’t have any difficulty.

Robinhood got its start by making investing in stocks easy for small, inexperienced investors, and this translates to their crypto platform. They provide plenty of guidance and tutorials that explain and walk you through the entire process.

Mobile App

BlockFi’s mobile app is available for iOS and Android devices and you can do pretty much everything from it that you can do from a PC. The app is available from Google Play or the Apple App Store.

Robinhood has a great mobile app that is available for Android and iOS devices. Everything that can be done from a PC can be done from the mobile app. It can be downloaded from the Apple App Store or from Google Play.

Access

BlockFi is available in most countries including the US with the exception of those countries sanctioned by the U.S., the U.K. or EU. It should be noted that U.S. users can’t open interest earning accounts. However, interest earning accounts opened prior to Feb 14, 2024 can be maintained.

Robinhood is available throughout the United States except for Hawaii and Nevada.

Wallets

BlockFi provides users with a non-interest-earning custodial wallet linked to their account. Users can lock the wallet with two-factor authentication and it can be used to buy, sell and trade cryptocurrencies.

Robinhood provides users with a custodial wallet for storing cryptocurrencies on their platform. They recently launched a non-custodial wallet to give users more control over their crypto assets but it isn’t yet able to handle all the cryptocurrencies supported by Robinhood.

BlockFi Pros & Cons

BlockFi Pros:

• Fast crypto backed loans with no credit checks
• Able to earn interest on 48 different cryptocurrencies
• Can borrow up to 50% of the value of your crypto collateral
• Majority (95%) of crypto assets stored offline

BlockFi Cons:

• Relatively high crypto withdrawal fees after the first withdrawal every month

Robinhood Pros & Cons

Robinhood Pros:

• No fees or commissions charged
• Majority of crypto assets stored offline
• Easy to use for beginners

Robinhood Cons:

• No interest earning accounts or crypto backed loans
• Only supports 16 cryptocurrencies

Conclusion

BlockFi and Robinhood are both good platforms but the available crypto services are limited at Robinhood. For U.S. based investors interested in trading a limited number of cryptocurrencies, Robinhood may be the better choice. However, for more supported cryptocurrencies, crypto backed loans and the capability of earning from your digital assets, BlockFi is the way to go.