COBINHOOD is a cryptocurrency trading platform whose beta version was launched at year-end 2017. The exchange boasts real-time trades and high security, but its most famous feature is as the maiden exchange to offer zero trading fees (though ironically the Robinhood exchange expanded into cryptocurrencies in 2018 and similarly offers that feature.)
COBINHOOD was founded by Popo Chen and Wei-Ning Huang, the latter of whom is a Google alum. The exchange boasts a seasoned management team and tapped technology veteran Tony Scott, a former Microsoft executive who also served in the Barack Obama administration, as an advisor.
COBINHOOD supports bitcoin, Ethereum, Tether, Litecoin, Bitcoin Cash, NEO and more than 40 altcoins along with multiple trading pairs. You can view a list of all the digital currencies they support here. They run both a centralized and decentralized trading platform with plans to migrate the centralized exchange onto the decentralized trading platform.
In addition to a cryptocurrency trading platform, COBINHOOD also runs an initial coin offering (ICO) underwriting business that the exchange’s co-founder Popo Chen compares to Goldman Sachs’ IPO underwriting business, only for new tokens.
COBINHOOD promotes investor security as a top priority, as evidenced by features like two-factor authentication, an offline vault, insured (in the case of the centralized exchange) online wallets, multi-signature wallets and more. There are no major security breaches to speak of since the exchange went live in December 2017. More than 13,000 users signed up for the exchange on their debut trading day.
The decision to create a zero-fee trading platform came from Chen’s personal experience trading cryptocurrencies, in which he said he felt like he was being robbed when he discovered the cut that the exchanges were taking.
That was the inspiration for offering zero-fee trading to investors, but COBINHOOD still must earn money, and they do so via a two-pronged business model. COBINHOOD attaches an interest rate to the loans they provide for margin trading of up to 10x leverage, and they generate revenue from the ICO underwriting business.
You can learn more about the inspiration for COBINHOOD’S zero-trading fee approach in the below interview with exchange co-founder Popo Chen —
· Supports several of the leading cryptocurrencies along with many other altcoins.
· Real-time trading
· Spot trading
· Margin trading with up to 10x leverage
· Instant withdrawals
· Market orders/limit orders/stop limit orders available both in the browser version and on mobile apps
· Supportive of hard forks including Bitcoin Cash, NEO and Gas
· No known security breaches. The exchange stores assets in an offline multi-sig cold vault and in online wallets that in the case of the centralized exchange are insured (this is a similar approach taken by Coinbase).
· Multiple trading pairs
· Easy-to-navigate trading interface that’s available in more than a dozen languages that can be changed via a drop-down menu on the home page.
· They have a referral program and offer bounties including BTC
· New exchange without much trading history that came on the scene during the cryptocurrency frenzy of 2017. As a result, users complain of low liquidity in coins.
· Delays in the KYC process, though the exchange appears to be moving away from its semi-manual identity checks for the Levels 2 and 3.
COBINHOOD vs. eToro
COBINHOOD is an up-and-coming cryptocurrency exchange that has received a lot of hype because of its zero trading fees as well as for the many altcoins the trading platform suggests. But it suffers from low trading volumes, especially in the new altcoins that it supports. eToro, on the other hand, supports trading in the biggest cryptocurrencies with the highest trading volume (BTC, ETH, XRP, LTC, DASH, XLM, NEO, BCH and ETC), so traders aren’t likely to face liquidity issues.
Withdrawals: While COBINHOOD doesn’t charge or profit from withdrawal fees, withdrawal transactions are still subject to the following rates to compensate miners who are completing the transactions. The withdrawal fees also cover the transfer between the exchange’s deposit wallets and hot and cold wallets.
· BTC = 0.001 BTC
· ETH = 0.007 ETH
· COB and other ERC20 tokens: USD 8.40 in the relevant fiat currency.
To perform a withdrawal, fill out the address you want the funds to be directed to or the bank account to send fiat money to.
As for other fees, the exchange charges for the following –
· Margin trading loan interest
· Subscriptions to COBINHOOD Prime. This service is designed for individuals and it provides high-level margin trading/lower latency ticker and higher trading API rate limit
· Access to its High Frequency Trading Server, which is designed for institutional investors.
Minimum & Maximum: COBINHOOD has the following trading thresholds in place –
· Maximum trading amount per transaction = USD 1 million
· Minimum trading amount per transaction = USD 20
Minimum trading units per token include:
· 0.00000001 for most tokens
· 0.000001 for TRX
· 0.00001 for GTO
· 0.0001 for RFR
· 0.01 for SUB and USDT
You can find a complete list of token minimums here.
Account limits are also tied to the account verification level, which is discussed in greater detail below.
COBINHOOD checks most of the security boxes that cryptocurrency exchanges have to offer, including –
· Cryptocurrency assets are stored in both hot wallets and multi-signature cold wallets
· Two-factor authentication, which can be activated via Google Authenticator or SMS.
· KYC – the exchange is transitioning from a semi-manual ID verification process to one that is more automated, which should improve identity verification times.
· Technology is built on the Google Cloud Platform, which relies on a layered security model, using Golang
· They guarantee 100% of reserves
There are no major security breaches to speak of since COBINHOOD launched at year-end 2017. COBINHOOD further describes its security features as such –
· The exchange stores “98% of cryptocurrency assets in an offline multi-signature vault. This vault requires five-out-of-eight geo-distributed hardware security modules to open.”
· Assets in an offline-wallet are “ultra-secured”
· Assets stored in online wallets are “backed by insurance companies.”
· The centralized trading platform boasts insured assets from various insurance companies. This is designed to protect investors’ funds if deposits are lost. If that happens, the exchange would “immediately liquidate their loss in fiat and calculate the average market orders at the time of the loss.”
As an added security measure, if you log-in from a different IP address, you’ll receive a “new device verification” email. The COBINHOOD management team also appears to welcome forthcoming regulation, as evidenced by Chen’s remarks –
“We believe that blockchain financial system will be under regulation in the future and we are more than happy to see that coming. We plan to operate under full legal compliance,” according to COBINHOOD’s Chen.
COBINHOOD’s plan is to have subsidiaries throughout “major fiat countries and work with local banks to provide multi-fiat service.” Till then, they accept the following payment methods –
· US Dollar (USD)
· Bitcoin (BTC)
· Ethereum (ETH)
· Cobinhood (COB)
· CyberMiles (CMT)
Withdrawals should be instantaneous. If you find that a withdrawal is taking longer than 24 hours, contact support (email address here.)
Avoid depositing funds from multi-sig wallets, mostly Bitstamp as it could trigger delays.
Creating an account on COBINHOOD is simple and requires providing an email address and password. You must also confirm that you don’t live in New York state and you’re not a citizen of Japan. Once you’ve signed up, they urge investors to activate two-factor authentication, which can be done with Google Authenticator or SMS.
To begin trading on COBINHOOD, you must verify your identity. The higher your ID verification level, the higher the limits associated with your account. When you first sign up, you’re automatically assigned Level 0 access, which has no deposit limits. With each level, the KYC ID verification requirements increase.
· Requirements = email and password.
· Daily limits associated with this level include: crypto deposit/no limits; crypto withdrawal/3 BTC; no monthly limits.
· Requirements = passing Level 1 verification, full name as it appears on your passport, proof of citizenship/country of residence, passport or driver’s license, selfie with you holding your ID, phone number and FATCA.
· Daily limits associated with this level include: crypto deposit/no limits; crypto withdrawal/100 BTC; no monthly limits.
There is also a Level 3, details for which are scarce but for which traders have applied.
Customers have complained about delays in the KYC process. Expect the following: For Level 1, the KYC-fueled identity verification process could be completed as fast as a few minutes, though there’s always the possibility they will require additional information that could delay the process. For Level 2 and Level 3, the process takes at least a few days and the longer the pipeline of applications, the longer the process can take.
Click on Exchange to get to the trading dashboard. Next, select which trading pair (product) you’d like to use from a drop-down menu. The default trading pair is COB/ETH, but you can select from a list of dozens more across four markets: BTC, ETH, USDT and COB.
On the right side of the dashboard, there’s the Order Book comprised of current orders. Sell order prices are depicted in red, while buy order prices are in green. Place your order as either Market Order, Limit Order or Stop Order.
Trade history reflects buy and sell orders of all users on the platform. You also have access to charting including bar, hollow candle, candlestick or line graphs. COBINHOOD runs a mini ticker with the latest price and relevant information for the product you selected, including –
· Last trade price
· 24-hour change in price
· 24-hour high price
· 24-hour low price
· 24-hour trading volume
COBINHOOD boasts real-time trading, a feature that Chen explains they can offer because the exchange built the entire cloud-based backend system themselves. He says in a Medium blog post: “The proprietary order book matching engine that can process millions of orders per second for every trading pair and under sub-millisecond latency. He adds: “The whole system is designed to be fully distributed, highly available and auto scalable.”
Meanwhile, as of April 2018, COBINHOOD unveiled plans to migrate from the USDT on Bitcoin’s Omni Layer Protocol to USDT listed as an ERC-20 compatible Ethereum-based Tether. At that time, the exchange was also adding to its list of supported blockchains with the additions of ACHAIN, EOS and IOTA.
They boast “stable and lightning fast APIs”
COBINHOOD also has an official app for iOS and Android, both of which have trading capabilities.
The COBINHOOD app on Google Play for Android 4 stars out of a possible 5 stars across more than 300 user reviews. On the positive side, traders rave about zero fees, but on the negative side, some investors suffer from unanswered support tickets and lost funds amid new coins that are no longer available.
The app is also downloadable via the App Store for iOS.
Traders on the COBINHOOD exchange who also hold the company’s COB token are entitled to certain benefits, including –
· “50% off margin trading loan interest”
· ICO issuers get new tokens issued at a discount
Instead of emailing support, you can reach them at what the exchange dubs the Zendesk. This can be accessed via the following tabs: Account>Contact Us on the dashboard.
COBINHOOD had the benefit of hindsight when it was preparing its ICO ahead of the launch of the trading platform and got to see one of the biggest complaints among traders was poor customer service. So, they designed their trading platform as the antithesis of many other cryptocurrency exchanges.
COBINHOOD’s Chen in a Q1 2018 interview discussed plans to man around-the-clock customer support with a 10-person team. Additionally, they have automated artificial intelligence (AI) support, but when that can’t get the job done, the live response times are intended to be immediate.
A major decision by COBINHOOD’s management team triggered negative sentiment, which was to offer a discount for its ICO token COB to social media celebrities. The special treatment invited criticism amid COBINHOOD’s mission to provide free and fair trading to all investors.
But Chen apologized for that move and since the exchange has been operational.
On the positive side, COBINHOOD has received a score of 9.1 out of a possible 10 for features such as legitimacy, project demand, user interface and availability, according to Central Airdrop.
COBINHOOD is an emerging cryptocurrency exchange that supports the major markets and offers trading in dozens of altcoins across numerous possible trading pairs. It’s ideal for investors who trade with frequency, given the zero fees, as well as investors looking to gain access to some of the newer coins that aren’t available on major exchanges, if you are willing to endure lower trading volumes until the exchange and its altcoins become more widely used.