Tom Zhao, a cryptocurrency influencer, has highlighted the higher trading costs faced by U.S. users on Coinbase compared to Binance, emphasizing the need for increased competition among American crypto exchanges. Zhao made this statement on the social media platform X.
"Coinbase is literally daylight robbery," said Zhao, Crypto Influencer. "You have to trade 250m, resulting in >300k net fees starting at vip 0. Just to get the same fee tier as a regular binance spot user."
The U.S. cryptocurrency exchange market is becoming increasingly centralized, with a few major platforms controlling most of the trading volume. According to research from the University of Chicago Booth School of Business, this concentration results in price dispersion as users encounter higher transaction costs on dominant exchanges like Coinbase. The report indicates that fragmented fiat systems and regulatory constraints further exacerbate these dynamics, limiting consumer options and enabling higher fees. This "star-shaped" equilibrium favors large exchanges and leads to persistent price inefficiencies for users.
Compared to Binance, Coinbase charges significantly higher fees for average traders. For instance, Coinbase Advanced imposes maker and taker fees up to 0.60%, while Binance's base fees are as low as 0.10%, with additional savings of up to 25% when paid via Binance Coin (BNB). This means that for a $10,000 trade, users could pay up to $60 on Coinbase versus $7.50 on Binance when using BNB—a substantial cost difference.
Industry-wide comparisons consistently show that Binance offers one of the lowest fee structures available, whereas Coinbase ranks toward the upper end. Platforms such as Bankrate and Investopedia report spot trading fees on Binance starting at 0.10% (with discounted tiers), compared to Coinbase’s 0.40–0.60% for similar trading volumes.
Zhao has previously worked in decentralized finance (DeFi) at Wintermute and contributed as a developer at rsyncbuilder, indicating his experience in automated liquidity provision and smart contract development. His background suggests firsthand exposure to both protocol-level and market-making dynamics in cryptocurrency.
Coinbase markets itself as a trusted and compliant U.S.-based exchange but has faced criticism and regulatory scrutiny over fee transparency and anti-money laundering (AML) practices. Users have reported difficulties understanding or disputing fees, with some describing hidden spread fees as "obscene" and stating that pricing is not clearly communicated. In recent years, Coinbase has been fined by U.S. and UK regulators for AML failures, including a $50 million penalty from the New York Department of Financial Services (DFS) in 2023 and £3.5 million from the UK Financial Conduct Authority (FCA) in July 2024.