Cryptocurrency is a digital currency that has been going around since 2009. With multiple benefits such as low-cost transactions, numerous people have been joining and investing in it. While many seem to have found it profitable, there are still some who are looking for reliable places to join.
Many still ask whether or not investing would be worth it, if you would be able to gain money through this, etc. While this is certainly on a case-to-case basis, in the end, it would depend on your knowledge, skills, and strategies regarding cryptocurrency.
If you are one of those looking to invest in cryptocurrency such as Robinhood crypto but have no idea if they are the best place to invest or not, then this article is for you. Here, we will give you a review of Robinhood Crypto, what it is, the positives, the negatives, and the like. So get ready to sit down and take notes in order to find out if Robinhood Crypto is the best cryptocurrency website for you.
What is Cryptocurrency?
Before we take a look at Robinhood Crypto, let us first understand what exactly is cryptocurrency. With that, we would be able to make a more informed decision as well as be more knowledgeable in the crypto world.
A cryptocurrency, or also known as “crypto” is a type of income that may be sent around the world without the need for centralized financial institutions like a government or bank. Cryptocurrencies, on the other hand, are produced using the techniques and processes of cryptography that allow users to purchase, sell, and or trade them safely.
A cryptocurrency is a combination of a digital asset and money. It functions similarly to money that may be used to make purchases. They can be invested in profits for the long term, much like a digital asset. You’re not purchasing money; you are rather purchasing the concept behind the penny, which is supported by technologies of blockchain.
What is Robinhood Crypto
If you are new to the crypto trading world, you might have heard of famous platforms such as Bitcoin and Coinbase. Well, Robinhood Crypto is quite similar to them with a few different properties.
Robinhood is a cryptocurrency exchange that handles trades and allows users to buy assets and crypto coins. This is a place wherein users will exchange their coins and move the proceeds to their accounts outside of this.
Those who use Robinhood do not actually possess their cryptocurrency. They are unable to buy Bitcoin or other altcoins on Robinhood and then move them to a cryptocurrency wallet or cold storage. Robinhood is only perfect primarily for individuals who are only prepared to spend a little sum of money in shares or cryptocurrency.
Robinhood Crypto Review & Facts You Should Know
Using Robinhood for crypto is safe as they keep the vast bulk of your currencies in cold storage. This means that it is protected and away from the internet. This adds an extra layer of security to the system. Moreover, they also have crime coverage, which covers a percentage of the property in their storage systems versus theft, especially computer breaches.
Robinhood Securities is a clearing brokerage firm rather than a market participant and does not short sell stocks. This is the same for every other brokerage as well including Fidelity, TD Ameritrade, and Charles Schwab. They all have the same two-day settlement timeframe. As soon as your order is fulfilled, you become the owner of the shares you purchased through Robinhood.
In the case that Robinhood goes down, you could either lose all of your assets or transfer them to a wallet that accepts them. But, it is always better to use wallets in which the encryption keys are under your control. Also, take note that it is not advisable for exchanges to be used as wallets.
Robinhood Crypto Features
To further understand what exactly can Robinhood give you, here are some features that Robinhood can give you, and why it can be quite beneficial to you should you choose to join.
#1 Robinhood accepts a variety of cryptocurrencies
While this was not allowed in the past, Robinhood now accepts multiple well-known cryptocurrencies such as Ethereum Classic, Bitcoin Cash, Dogecoin, Bitcoin SV, and Litecoin. With that said, this shows how Robinhood is slowly but surely adapting to the constant changes in the area of crypto.
Moreover, this has a broader range than many of the other financial programs that have opted to bring out cryptocurrencies including Webull Crypto which currently solely supplies 4 cryptos to clients. Lastly, you can also watch market volatility and updates regarding this and 10 more cryptocurrencies.
#2 Trading is possible anytime
In their platform, the markets never close. Meaning you can trade whatever time you want and not have to worry and think about whether or not you can trade at a certain time. Greatly useful to those who can only trade during the later hours of the day.
#3 Robinhood offers cryptocurrency wallets
This is especially favorable to you as crypto wallets allow users’ digital assets and to be retrieved and stored. While this is a plus in their book, Robinhood however does not allow the withdrawal of coins.
More features that Robinhood has would include:
- On the platform, there are no commissions for trading cryptocurrency.
- Fractional coins can be purchased in $1 installments.
- Robinhood Crypto is independent from Robinhood Financial, meaning you have two accounts in total since they are separate.
- Robinhood monitors your pricing baseline and profits would also be recorded to the IRS.
Pros of Robinhood Crypto
Now that we have discussed what exactly Robinhood Crypto is, it is time to expound on its benefits, what it could give you going into this, as well as why it might be a good investment.
Since it provides its users with advantages such as no fees it makes you wonder what else it could offer. With that said, here are some of the positives of Robinhood Crypto:
#1 User friendly
This is perfect for those only starting in the crypto world or even those experienced as it would be easier for you to navigate everything and keep track because of its user-friendly site. Moreover, since this is easy to use, you will not waste a good amount of your time in trying to figure out how it operates and instead focus on your stocks.
#2 They do not charge fees
Compared to other cryptocurrencies, Robinhood does not charge any fees and you can choose to sell or buy how much you want with no extra charge. This is a benefit for those who like to invest their money in crypto as small as possible.
#3 Perfect for day trading crypto
If you are an avid trader, morning trader, and margin trader who wishes to buy and sell investments without paying a commission, you should use Robinhood. If you want to invest in cryptocurrencies, the share-trading broker may be a suitable choice for you.
Other pros include:
- In 46 of the 50 states, Robinhood Crypto is available.
- Before conducting a cryptocurrency purchase, funds do not have to rest in your profile.
- Seven prominent cryptos, such as Bitcoin and Dogecoin, are purchasable.
- Robinhood keeps the most of its cryptocurrency in cold storage and has insurance in place to defend against burglary.
Cons of Robinhood Crypto
Robinhood Crypto may seem like the perfect place to invest now that you have seen all its pros. Although, part of making an informed decision would mean hearing out its risks as well. This means that before you do decide to push through with Robinhood Crypto, it is important to look at some of the risks you might be going through if ever you decide to follow along with your plan.
#1 It is not possible to withdraw your coins
As said earlier, you are not allowed to withdraw your coins in Robinhood. The only possible things for you to do there would be to purchase, keep, and trade. You are unable to transfer Bitcoins to another blockchain wallet, and spend it on purchases from the real world, or receive it from others.
This may be one of the biggest disadvantages when it comes to cryptocurrency trading in Robinhood. However, Robinhood does have plans of having beta testing to launch a new wallet for crypto.
#2 Has suffered security breaches
No crypto is completely immune to this but if you are one of those people who are not keen on cryptos with multiple security breaches, then Robinhood might not be for you. While it would be your prerogative, you must be aware that they have suffered from the hands of hackers numerous times before.
Other cons include:
- You won’t be able to transfer them to another wallet
- Robinhood Crypto is still not available in some states specifically New Hampshire, Hawaii, West Virginia, and Nevada.
Now that you have understood what cryptocurrency is, the pros and cons of Robinhood Crypto, it would be easier for you to make a decision that would best suit you. With that said, while it presents many appealing pros, do not forget to also weigh in and balance the negatives of cryptocurrency.
What exactly could we gain from this? Would the gain be worth the risk? Being able to weigh in all the benefits and the risks encourages you to create a more informed decision on whether or not it would be worth investing both your time and money in.
Robinhood Crypto can provide you with numerous benefits that you have been looking for, however, you must be prepared when things might not go your way. Cryptocurrency can be quite unexpected and unstable, thus, going into this, be sure you have a safety net, something to lean on, awareness, and some preparations in case plans go awry.
It is important to always be informed especially when it comes to choices involving money. With that said, if you have decided to invest in Robinhood Crypto, we wish you the best of luck as you try to achieve your goal in the area of cryptocurrency.