If I Buy Crypto On Robinhood Do I Own It

At that place are some advantages to using the trading app, merely it isn’t right for everyone.

Robinhood is best known as the stock trading app that pioneered the concept of commission-free trading several years before most brokerages got rid of their trading costs. Only you can likewise purchase Bitcoin and vi other cryptocurrencies direct through the app.

Like all cryptocurrency trading platforms, Robinhood isn’t the best pick for everyone. Here’due south a rundown of the key advantages and disadvantages of using Robinhood to buy Bitcoin.

Benefits of using Robinhood to buy Bitcoin

Robinhood pioneered committee-gratis stock trading several years ago, and while its competitors accept largely caught up to the visitor’s pricing structure in the brokerage side of the business, the same cannot be said of cryptocurrency trading.

Specifically, many of Robinhood’south top competitors have expensive and somewhat difficult-to-sympathise pricing structures. For instance, Coinbase charges a 1.49% trading fee for near transactions, so if you want to purchase $500 worth of Bitcoin, yous pay about $7.50. And that’s on top of a markup, or spread, you pay over the current market place price. To be off-white, Robinhood makes money from the spread between its current buy and sell prices, but that’s it — no other fees employ.

In that location’south also value in having your cryptocurrency holdings and stock investments in the same easy-to-use app, and Robinhood certainly lets yous practice that. Many people look at Bitcoin as an addition to their investment portfolios, so it makes a lot of sense to go along all of your investments in one place. With Robinhood, yous can. With many other cryptocurrency exchanges, non and then much.

Drawbacks of using Robinhood to purchase Bitcoin

By far, the biggest drawback to Robinhood’south cryptocurrency trading platform is that
all
you can do is purchase, agree, and sell your cryptocurrencies. In other words, you
can’t
send your Bitcoin to another cryptocurrency wallet, spend information technology on real-earth purchases, or receive Bitcoin from other people. It doesn’t have nearly as much functionality as nigh leading cryptocurrency exchanges exercise.

Robinhood too offers far fewer educational resources and other features. It is mainly a place where yous can buy, hold, and sell Bitcoin and a few other types of cryptocurrency. If you buy Bitcoin on Robinhood and it goes upward in value, you can sell it and make money. But in that location aren’t many other reasons to use Robinhood for your cryptocurrency needs.

Finally — and this point won’t apply to investors who but desire to buy Bitcoin — more than avid cryptocurrency traders volition discover that in that location are other platforms with far more cryptocurrencies to choose from than the seven Robinhood offers. If you lot desire to invest in Bitcoin and the other most popular digital assets, Robinhood probably has what y’all need. Only if you’re thinking of putting some of your money in smaller, up-and-coming cryptocurrencies, you might want to look elsewhere. For instance, Coinbase offers more than than 90 tradeable coins.

Should
you
use Robinhood to buy Bitcoin?

The short respond is that information technology depends
why
y’all want to buy Bitcoin. If your goal is to pay for purchases using Bitcoin, or if you lot want to send Bitcoin to friends or to an external Bitcoin wallet, Robinhood is non the best choice for you. On the other hand, if your goal is just to concord Bitcoin and benefit from rising prices over time, Robinhood tin can exist an easy and low-toll style to do it, especially if you lot’re already using the platform for stock trading.