Choosing a cryptocurrency exchange that is safe, reliable, and easy to use, all at the same time is a tedious task. For most, the best way to figure out the ideal exchange is through trial and error. However, with our Bitstamp review, you can rest assured that our trials and research will help you make an informed decision.
You might expect a review to contain details like advantages and disadvantages, fees, features, etc. However, if you’re going to use an exchange, it is important to first understand the fundamental belief upon which it was founded, to ensure you invest in the right exchange found by the right people with the right intention.
Origin And Overview
Founded in 2011 and based out of Luxembourg today, Bitstamp is one of the oldest exchanges of cryptocurrencies in the world. It was the first-ever exchange to compete with the then most popular exchange Mt. Gox.
It was initially founded in Slovenia, and, for co-founders Nejc Kodric and Damijan Merlak, safety and reliability were the cornerstones of their project. In 2013, they moved operations to the UK, but a dearth of cryptocurrency regulations meant no trust among the people. After all, who could trust a firm that did not follow the rules?
Mt. Gox was ruling the European markets midway through 2011 but had its fair share of security troubles and hacking attempts. Eventually, it went bankrupt in 2014, but Bitstamp still did not have a firm footing up until that point.
However, it all changed when they moved to Luxembourg in 2016. The country had crypto regulations in place and was one of the few in the world to govern crypto-based transactions.
In April 2016, after many discussions between the government and Bitstamp, the Luxembourg government granted the Bitstamp exchange a license to act as a fully regulated payment institution in the EU. This allowed them to carry out business with all EU member states, and it has since then come a long way.
According to Coin Market Cap, Bitstamp is one of the top 10 crypto exchanges in the world today.
Bitstamp’s rise to the top 10 is not coincidental. The exchange has provided users with great services and features and has been able to stand out for its security and safety. Some of the more noteworthy cons that we’ll be seeing in this Bitstamp review are:
1. Exchange Fiat With Cryptocurrencies
You can buy cryptocurrencies with fiat currencies. Fiat currencies are those currencies that are officially recognized in their countries, like the US Dollar, or the European EURO. Some exchanges don’t allow this, which means you’ll have to visit some other exchange, buy cryptocurrency from there in exchange for fiat currencies, and then use those on the exchange you want to trade with.
Bitstamp supports buying and trading with USD and EUR while supporting buying but not trading with Swiss Francs and British Pounds.
2. Flexible Payment Options
A lot of exchanges out there do not give you the flexibility to pay using plastic cards such as your credit and debit cards. With Bitstamp, you can choose to pay using credit cards, debit cards, or even wire transfers.
3. Reliable Security And Compliance
How safe is Bitstamp? The answer is – safe enough for you to trust it today, smart enough for you to keep trusting it tomorrow. Bitstamp has many security features that we’ll see in-depth down below, but suffice to say, they remember how valuable your privacy and security are for you.
Bitstamp is a licensed, reputed exchange that complies with all AML and KYC regulations. Creating an account might be free, but the KYC process is stringent and you need to go through a few verification tasks before you can make any deposits or payments.
Apart from this, they were one of the only seven out of 15 cryptocurrency exchanges that responded to a survey of the New York Attorney General regarding transparency on anti-hacking measures, security, and business practices. They assured that they’d sought approval from the New York State Department of Financial Services to operate their business in New York state.
Bitstamp is one of the relatively affordable exchanges out there. Although it isn’t the cheapest one, the fees are very reasonable. You might find the commission of 5% for purchases on credit cards high, but it’s fair enough since not all exchanges even support credit card purchases.
The fees depend on where you live and what kind of payment mode you use, but trading fees start with 0.25% and, depending on your trade volume, go as low as 0.1%. You’ll find the fee chart and charges based on the type of your transaction in more detail as you read further.
5. Easy Of Access Through Its Mobile Application
Any Bitstamp review is incomplete if it fails to mention one of the USPs of Bitstamp – its mobile application. It has a 4.8/5 rating at the Apple App store, and the dashboard of the app is the perfect place to keep an overview of the prices and market trends. Making purchases and trading within the app is just as simple, although you might have to spend time understanding the user interface before you can rely completely on the app.
6. High Liquidity
Liquidity ensures that a coin or currency can be quickly converted into liquid funds for immediate use in the global market. High liquidity ensures that the company is reliable and can withstand sudden losses or market volatility. In other words, the exchange is far from being bankrupt.
7. Inaccessible With VPNs
In the same survey by the New York Attorney General, they were one of the only two exchanges who claimed they blocked access through VPNs. This means every action is traceable, and without VPNs, hacking would be pretty hard.
What’s a Bitstamp review that doesn’t show both sides of the coin? Although not many, Bitstamp does have a few cons. They’re listed below:
1. Limited Coins
As we already discussed, Bitstamp has a lot of advantages and features that cater to customers, but they have still not dived deep into the cryptocurrency markets. The platform does not support lesser-known currencies and altcoins for trading or purchase.
Although this is a slight hindrance, the exchange does support every major currency and is growing the list probably as you’re reading this. We’ll take a look at the currencies it supports in-depth as you read further.
2. Not Beginner Friendly
If you’ve already used other exchanges and are well-versed with the world of cryptocurrencies and exchanges, this might not prove to be a headache for you. However, if you’re a beginner all set to start your journey with the crypto market, you’ll need to take the time to understand the UI and operational methods of the platform.
The UI is not one of the easiest to work with, and you’re likely to have a tough time at first. But once you’re comfortable, rest assured, it’ll be smooth as butter.
3. Provides Only Basic Customer Support
More than a con, this is an annoying feature for many users. The customer support is very active, and they claim to respond to your emails within three days. They also have a UK-based helpline for emergencies. However, the support team receives thousands of support tickets daily, and it might be a while before your query reaches them.
The emergency number has a recorded receiver, which means although there is a helpline number, a bot will answer your doubts. This can be annoying for advanced users who’ve already tried the basic tricks to get their problem fixed.
Having said that, there is a very detailed and descriptive customer FAQ on their website which solves most of the basic and intermediate level issues.
Bitstamp’s Privacy And Security
One of the most common concerns regarding Bitstamp is its security, although, ironically, its creators founded this exchange with security as their chief focus. The exchange was hacked in 2015, and 19,000 BTC were stolen. Since then, people have had trust issues with them.
However, let’s be honest – 2015 was a different era. Bitstamp did not even have a global trade license back then. Everyone was still learning about the possibilities of blockchain tech. Today, however, you’re well behind the eight-ball if you’re still asking a question like ‘is Bitstamp legit’.
Hack attempts are like holes drilled into your walls. It’s important how you deal with them once the damage is done. Bitstamp, after the hack attempt, ensured that no customer funds were lost. About 5 million USD were stolen but Bitstamp customers did not lose a single penny, the exchange ensured this. Post the hack, they rebuilt the platform from scratch, and owing to their commitment, is one of the safest exchanges in the world today.
The three most important of their security features are 2 Factor Authentication (2FA), text message alerts, and PGP (Pretty Good Privacy). 2FA ensures that each user must provide two kinds of input to the system to verify themselves as the right user. Think of your Gmail account password and the pairing number you receive on your approved device – that’s 2FA at work.
PGP is an encryption system specifically built for cryptographic security. With this, all communications and data are encrypted, including system files, texts, emails, disk partitions, etc. Moreover, each account is verified manually, and 98% of customer assets are stored in cold storage and protected with 2FA to protect against hacking attempts.
So, how safe is Bitstamp? Safe enough, wouldn’t you agree by now?
Is Your Country Supported?
Over 60 countries are supported, which include all major countries where cryptocurrency trading is common or not banned and on the rise. This list includes 28 countries of the EU as well as countries like the USA, New Zealand, South Korea, Australia, Brazil, and more.
Are All Your Coins Supported?
Bitstamp supports all major cryptocurrencies such as Ethereum, Bitcoin, XRP, Chainlink, Bitcoin Cash, Litecoin, etc. It also supports the purchase of most of them in either of the fiat currencies EUR or USD. Combining these, you get a total of 80 supported cryptocurrencies on this platform.
If you think this number is less, well, you’re not wrong. Some exchanges support over 200 in totality. While the number of currencies is not as attractive as their competitors at the time of writing this Bitstamp review, the number will serve your purpose. The most popular and bankable currencies are already supported by the platform
Also, they are constantly evolving. To put it into perspective, up until about a month or so ago, they were offering trades and exchanges of only five currencies – BTC, BCH, LTC, ETH, and XRP. But as of now, they’ve expanded to support the likes of LINK, XLM, OMG, USDC, AAVE, UNI, ZRX, BAT, and many more.
What Are The Fees?
The fees are charged based on the cumulative volume at the end of a cycle, and each cycle lasts for 30 days.
Volume Post Each Cycle
Apart from these trading fees, these are the fees you need to be aware of:
- Credit Card purchases: additional 5% charged
- Debit Card Withdrawals: At least $10, more depending on the withdrawal amount.
- Deposits and Withdrawals Between Cryptocurrencies: No charges
- Transferring Funds to Credit or Debit Cards: $10 up to transactions of $1000, 2% of the amount as fees for transactions exceeding $1000.
- SEPA Deposits: No Charge
- SEPA Withdrawals: 0.90 EUR
- Bank Wire Transfer Deposits: 0.05%
- Bank Wire Transfer Withdrawals: 0.09%
- International Wire Transfer: 0.05% (minimum $7.5 and maximum $300).
Concluding This Bitstamp Review
As an exchange that took off in the latter half of 2016, Bitstamp has shown the most meteoric rise out of most of the listed exchanges. This is because they have consistently shown their customers that they are valued.
Today, if you ask questions like ‘is it advisable to use Bitstamp?’, or ‘is Bitstamp legit?’, the answer is a definitive yes. It is a constantly evolving exchange with affordable fees, great security, ideal compliance standards, and a lot of payment flexibility.
You need to remember that the only cons this exchange has of today all pertain to limited expansion. As the exchange evolves with time, the increased support of geolocations and currencies along with other updates makes this exchange a very reliable and promising one. If things pan out as per the company’s vision, which they have so far, although it’s already quite reliable and reputed, Bitstamp is yet to peak.
Laura has been interested in finance for a very long time, especially since her graduation in Economics. With the increasing popularity of cryptocurrency, she decides to read up more on the subject and soon became an expert. Laura has been dabbling with crypto ever since and started investing in them in 2017.