Robinhood Crypto Review 2025: The Truth Behind "Commission-Free" Trading
We break down Robinhood's hidden spread costs, NY transfer restrictions, and what the Bitstamp acquisition means for crypto traders.
⚡ Quick Verdict
Robinhood offers genuinely simple crypto trading with no visible commissions, but the 0.30-0.40% spread effectively costs more than exchanges like Kraken (0.16%) or Binance.US (0.10%). Best for casual investors already using Robinhood for stocks who want basic Bitcoin/Ethereum exposure. Not recommended for active traders or those wanting to withdraw crypto to self-custody.
📑 In This Review
Robinhood revolutionized stock trading by eliminating commissions, and they brought the same "commission-free" model to cryptocurrency. But here's what most reviews won't tell you: you're still paying—it's just hidden in the spread.
After analyzing Robinhood's crypto offering against dedicated exchanges, we found that "free" trading can actually cost you more than platforms with explicit fees. This review breaks down exactly how much you're really paying, what limitations exist (especially for New York users), and whether Robinhood's recent Bitstamp acquisition changes anything.
The Spread: What "Commission-Free" Really Costs
Robinhood doesn't charge commission, but they make money through the spread—the difference between what you pay to buy and what you receive when selling.
💡 How the Spread Works
If Bitcoin's market price is $90,000, Robinhood might show you a buy price of $90,315 and a sell price of $89,685. That $630 gap (0.35% each direction) is effectively your trading cost.
Based on our analysis, Robinhood's crypto spread typically ranges from 0.30% to 0.40% on major assets like Bitcoin and Ethereum. This can widen significantly during volatile markets or for less liquid altcoins.
Real Cost Comparison: $10,000 Trade
| Platform | Fee Structure | Cost on $10K |
|---|---|---|
| Robinhood | ~0.35% spread | $35.00 |
| Coinbase (Simple) | 0.60% taker | $60.00 |
| Coinbase Advanced | 0.60% taker | $60.00 |
| Kraken Pro | 0.26% taker | $26.00 |
| Binance.US | 0.10% flat | $10.00 |
Robinhood beats Coinbase's simple interface but loses to every exchange with a "Pro" or "Advanced" tier. If you're willing to use limit orders on Kraken Pro, you'll pay 0.16% maker fees—less than half of Robinhood's spread.
Complete Fee Breakdown
| Fee Type | Robinhood | Notes |
|---|---|---|
| Trading Commission | $0 | No explicit fee |
| Spread (Hidden Cost) | 0.30-0.40% | Varies by asset |
| Crypto Withdrawal | Network fee | Dynamic based on congestion |
| Deposit (Bank/ACH) | $0 | Instant deposits available |
| Fiat Withdrawal | $0 | 1-3 business days |
The key insight: Robinhood's spread effectively acts as both your maker and taker fee combined. Unlike exchanges where you can reduce costs with limit orders, Robinhood's spread applies to every trade regardless of how you place it.
New York Restrictions: What NY Users Can't Do
⚠️ Critical Limitation for New York Residents
While Robinhood operates in New York, NY users cannot transfer cryptocurrency off the platform. This means:
- No sending Bitcoin to a hardware wallet
- No transferring to another exchange
- No using your crypto for DeFi or payments
- Your only exit option is selling back to USD
This is due to New York's strict BitLicense requirements. Only three platforms hold full BitLicenses allowing unrestricted crypto transfers in NY: Coinbase, Gemini, and Bitstamp.
Robinhood holds a limited NY license that permits buying and selling, but not transferring. For NY residents who want true ownership of their crypto (self-custody), we recommend Gemini or Coinbase instead.
Bitstamp Acquisition: What It Means for Users
In 2024, Robinhood announced the acquisition of Bitstamp, one of the oldest cryptocurrency exchanges (founded 2011). This acquisition has significant implications:
✅ Potential Benefits
- • Access to Bitstamp's institutional-grade infrastructure
- • Bitstamp holds a full NY BitLicense
- • European expansion opportunity
- • More crypto assets potentially available
- • Improved liquidity depth
⏳ Unknowns
- • Will NY transfer restrictions be lifted?
- • Integration timeline unclear
- • Fee structure changes uncertain
- • Bitstamp operates independently for now
- • Regulatory approval still pending
The Bitstamp acquisition could eventually resolve Robinhood's NY transfer limitation, but until regulatory integration is complete, nothing has changed for current users.
Features & Limitations
What You Get
Available Features
- ✓ Buy/Sell major cryptocurrencies
- ✓ Crypto transfers (except NY)
- ✓ Recurring buys (DCA)
- ✓ Price alerts
- ✓ Portfolio tracking
- ✓ Combined stocks + crypto in one app
Missing Features
- ✗ Limit orders for crypto
- ✗ Staking rewards
- ✗ Advanced trading tools
- ✗ Margin/leverage trading
- ✗ API access for bots
- ✗ Wide altcoin selection
Supported Cryptocurrencies
Robinhood offers approximately 20-30 cryptocurrencies—far fewer than exchanges like Coinbase (280+) or Kraken (200+). You'll find the major assets:
Pros & Cons
✅ Pros
- • Ultimate simplicity – No confusing order types or interfaces
- • Unified portfolio – Stocks, ETFs, options, and crypto in one app
- • Instant deposits – Trade immediately while ACH settles
- • No minimum – Start with any amount
- • Crypto transfers available – Can withdraw to wallets (except NY)
❌ Cons
- • Hidden spread costs – "Free" trades cost 0.30-0.40%
- • No limit orders – Can't control execution price
- • NY transfer restriction – No self-custody for NY residents
- • Limited coins – ~25 cryptos vs. 200+ on competitors
- • No staking – Can't earn yield on holdings
Who Should Use Robinhood for Crypto?
👍 Good Fit
- • Already use Robinhood for stocks
- • Want maximum simplicity
- • Buying and holding BTC/ETH long-term
- • Don't need self-custody
- • Trade small amounts occasionally
👎 Bad Fit
- • Active traders (spreads add up)
- • NY residents wanting self-custody
- • Want to stake for yield
- • Interested in altcoins beyond top 20
- • Need advanced order types
Final Verdict
Our Rating: 3.5/5
Good for beginners, expensive for active traders
Robinhood legitimately delivers on simplicity—it's the easiest way to buy Bitcoin alongside your stock portfolio. But "commission-free" is marketing, not reality. The 0.30-0.40% spread means you're paying more than Kraken Pro (0.16%) or Binance.US (0.10%).
For casual investors buying and holding, Robinhood is fine. For anyone else—especially active traders, NY residents, or those wanting staking/yield—dedicated exchanges offer better value.
💡 Better Alternatives by Use Case
- Lower fees: Kraken Pro (0.16% maker) or Binance.US (0.10%)
- NY residents: Gemini (full BitLicense, can withdraw)
- Beginners wanting simplicity + staking: Coinbase (offers staking)
- Self-custody focus: Kraken (supports Lightning Network)
Frequently Asked Questions
Is Robinhood crypto actually free? ▼
No. While there's no commission, Robinhood takes 0.30-0.40% through the spread (the difference between buy and sell prices). On a $10,000 trade, you're paying roughly $35-40 in hidden costs.
Can I transfer my crypto off Robinhood? ▼
Yes, in most states. Robinhood now supports crypto withdrawals to external wallets. However, New York residents cannot transfer crypto—they can only sell back to USD.
Is Robinhood safe for crypto? ▼
Robinhood is regulated as a broker-dealer (FINRA member) and has never suffered a major crypto hack. However, crypto holdings are not SIPC-insured. They carry crime insurance for digital assets but with limitations.
What does the Bitstamp acquisition mean? ▼
Robinhood acquired Bitstamp (a licensed European exchange) in 2024. This could eventually improve their regulatory standing and potentially allow NY transfers, but nothing has changed for users yet pending integration.
Should I use Robinhood or Coinbase for crypto? ▼
Coinbase offers more coins (280+), staking rewards, and a "Pro" tier with lower fees. Robinhood is simpler and better if you already use it for stocks. For serious crypto investing, Coinbase Advanced or Kraken Pro offer better value.
Compare All Crypto Exchanges
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