A Reddit user recently shared their surprise after buying Bitcoin on Robinhood for $109,000, only to find out that their cost basis was listed as $109,600. This situation is more common than you might think and can leave many new crypto investors feeling confused or frustrated.

If you’ve experienced something similar, don’t worry—you’re not alone. Whether you're using Robinhood, Coinbase, or any other trading platform, it's important to understand how pricing works behind the scenes. This guide will break down why your purchase price may appear higher than expected, and what factors influence that final cost.

Understanding the Cost Basis on Robinhood

When you buy Bitcoin on Robinhood, the price you see in the app might not always match the exact price on major exchanges like Coinbase or Binance. This is because Robinhood doesn’t allow direct trading on the open crypto market. Instead, they fulfill your order through a third-party liquidity provider.

Here’s what might be causing the price difference:

1. The Spread Between Buy and Sell Prices

The spread is the difference between the buy price (what you pay) and the sell price (what you get when you sell). Platforms like Robinhood often widen this spread to cover operational costs, especially since they advertise “no trading fees.” This means you may pay more than the current market rate when buying Bitcoin.

2. Execution Delay and Price Fluctuation

Cryptocurrency markets are very volatile and can change in seconds. When you place a buy order, even a short delay in execution can cause the actual purchase price to be higher—especially during a fast-moving market.

Sometimes users also face other technical issues that cause delays. For example, users dealing with bitcoin withdrawal canceled messages may experience frustration due to timing-related glitches or platform limitations.

3. No Control Over Order Type

On Robinhood, users don’t get to choose advanced order types like "limit orders." Every trade is a market order, which means the platform executes your order at the next available price. During high volatility, this can result in a higher-than-expected buy price.

Additional Factors That Might Affect Cost

A. Robinhood’s Business Model

Robinhood offers commission-free trading, but that doesn't mean it operates without making money. Instead of charging fees directly, it routes orders through market makers and earns a small cut (a process called payment for order flow). This sometimes leads to less favorable execution prices for users.

B. Price Display Differences

Robinhood may show a simplified view of Bitcoin’s current price, which doesn't always reflect the real-time market depth or volume. What you see on the screen is often a rounded or delayed price, which may not match the actual rate at which your order is filled.

What You Can Do to Avoid This in the Future

While you can’t change how Robinhood works, you can use a few tips to manage your trades better:

• Track Live Prices on other exchanges like Binance or Kraken for more accurate market data.

• Use Advanced Platforms if you want more control over your trades, such as setting limit orders.

• Trade During Low Volatility hours to avoid large price jumps between placing and executing an order.

Should You Be Concerned?

No, you haven’t been scammed. The extra $600 in cost is part of how platforms like Robinhood structure their services. It’s important, though, to be aware of these differences so you can make informed choices when investing in crypto.

If you frequently buy or sell Bitcoin and want more transparency or control, you may want to consider switching to a platform that offers full trading features and wallet access.

Final Thoughts

Seeing your Bitcoin cost listed as higher than expected can be frustrating, especially if you’re new to trading. But in most cases, it’s due to things like spreads, execution timing, and how the platform displays prices. Understanding these factors can help you make better trading decisions in the future.

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