Considering investing in cryptocurrency? One way to do so is with Robinhood. This service offers free cryptocurrency trading and does not charge a commission for cryptocurrency purchases. It also provides stop-loss orders and is available in 46 states. However, a few important things to know before investing in cryptocurrencies with Robinhood are:
Robinhood does not charge commission fees for cryptocurrency purchases
One of the most important things to remember when making a cryptocurrency purchase is that Robinhood does not charge any commission fees. The service earns its revenue from cryptocurrency sales. As a result, the commission fees you pay will never be greater than the price you paid. This is a great feature for beginners who want to learn more about cryptocurrency and get started investing. However, the only drawback to this service is the limited selection of cryptos available. You will have to look for other options, such as Coinbase, if you are planning on buying more than one cryptocurrency.
While most cryptocurrency exchanges charge some sort of commission fee, Robinhood does not. To purchase cryptocurrencies, simply navigate to the Robinhood website and choose Crypto from the Trading Lists tab. Once there, type in the name of the crypto you want to buy. Then, tap Buy on its market page. Choose the market order or limit order. You can also choose the amount of coins to invest. You can see both the price and the total value of the crypto after you input it.
It offers stops-loss orders
The first step in setting up a stop-loss order in Robinhood is choosing the stop-limit type. You can select one-day, 90-day, or both, and then enter the number of shares you wish to trade. After that, you can view stock performance and relevant data, then choose a stock and click on the trade button. Once you have chosen the stop-limit type, you can set a limit price for the order.
In addition to allowing stop-loss orders, you can also set limit and market buy orders. Limit orders are routed in a limited fashion, and Robinhood Crypto applies a 1% collar to them, making them more likely to be executed. However, market buy orders may not execute at the exact amount that you initially entered. In that case, the conversion rate will be the prevailing market price.
It offers a limited range of cryptocurrencies
One downside of Robinhood’s crypto trading services is that its selection is rather limited. While the company’s overall platform allows you to trade a variety of assets, its crypto trading service is restricted to 51 cryptocurrencies. The service does offer a digital wallet, though. This is a drawback, as you’ll be limited to only a few coins. Despite the limited selection, Robinhood’s team emphasizes that crypto is an integral part of the company’s mission to bring digital assets to the masses.
Although Robinhood offers a limited selection of cryptocurrencies, its services are great for first-time investors and cryptocurrency enthusiasts. Coinbase supports over six times more cryptocurrencies than Robinhood does, and it is constantly adding new ones. It also offers the same seven cryptocurrencies that Robinhood does, with the exception of Dogecoin. Coinbase also supports USD, EUR, GBP, and CAD, while Robinhood only offers the USD.
It is available in 46 states
Although the company offers crypto trading services in all 50 US states, some jurisdictions have prohibited the service. Nevada and Hawaii, for example, do not allow it. However, the company has promised to expand its crypto services and make them available in these states in the future. In the meantime, you can already buy and sell selected digital currencies on Robinhood with a commission-free account. It also offers price tracking of ten additional cryptocurrencies.
Robinhood is the only commission-free cryptocurrency trading platform to be available in all 50 US states. The company has been offering crypto services for a long time, but users cannot use their own crypto until they have created an account on the platform. Those who already own Ethereum cannot use it to buy NFT. The company has also stated that when you buy Bitcoin on the platform, you are purchasing one Bitcoin and not a particular crypto.
It charges fees
If you’re new to cryptocurrency trading, you may be wondering whether you should use a platform such as Robinhood. It offers commission-free cryptocurrency trading in most states, with plans to expand to more states in the future. One of its greatest strengths is that it doesn’t require an account minimum and features a simple fund process. With banks providing instant verification, funds are transferred in real time, meaning no waiting and no fees.
Though it is a cryptocurrency exchange, unlike a traditional stockbroker, Robinhood isn’t regulated. Instead, it’s regulated by states through money transmitter licenses. In New York, Robinhood is regulated by the Department of Financial Services, which primarily considers the coins a regulated business can list, not the actual fees it charges its customers. As such, it is not a full-service broker like Charles Schwab and Merrill Edge, but it has a loyal following among young, tech-savvy investors and influencers. Despite the skepticism, traders can enjoy the low fees and hassle-free trading of Robinhood and other popular crypto exchanges.