Bitstamp Review – Guide to the Crypto Exchange Bitstamp is a cryptocurrency exchange that has a presence in Europe as well as in the United States. It’s an excellent exchange for both beginner and intermediate traders, and this well-respected exchange is known for its low fees and its reliable transactions. If you’re new to the cryptocurrency exchange world, this comprehensive guide will tell you everything you need to know Bitstamp so you can decide if this exchange is an excellent choice for your needs or if you should keep looking.
In 2011, Nejc Kodrič and Damijan Merlak founded Bitstamp with the goal of catering to a European clientele. They wanted to give people an alternative to the other large and popular cryptocurrency exchange, Mt. Gox. Bitstamp originated in Slovenia, and it has since branched out and expanded by opening offices in the United Kingdom in 2013 and an office in Luxembourg in 2016. As of 2018, Bitstamp has offices in New York and London as well.
This exchange draws intermediate, expert, and beginner traders who are interested in using flat fiat currencies to buy a variety of established cryptocurrencies. Bitstamp has gained a reputation for giving traders an inexpensive way to trade more substantial digital currency amounts, and this platform currently sits in the top 10 exchanges for trading volume.
Bitstamp has around 700 million dollars worth of various cryptocurrencies that pass through the exchange each day, and it’s popular for trading Euros and US dollars for Bitcoin, Ethereum, Ripple, and Litecoin. Of the 700 million dollars worth of daily exchanges, the US dollar accounts for over 60 percent of the fiat currency exchanged for the largest three cryptocurrencies.
Bitstamp’s Notable Features
This cryptocurrency exchange has a few notable features that streamline the exchange process and make it easy for you to find the answers you need to exchange your currency successfully.
- Customer Support – Bitstamp has an extremely comprehensive frequently asked question section where you can go and find answers to the most common questions you may have about the exchange. This page also contains tips and a walkthrough on how to sell or buy cryptocurrency. For specific questions, you’re able to email customer support directly, or you can call your local office.
- International Capabilities – Currently Bitstamp is available for users in over 60 countries, in the United States, and across Europe. This list currently includes Australia, India, China, Hong Kong, Brazil, New Zealand, Japan, South Korea, Singapore, and many more places.
- Minimal Fees – This exchange is very popular with users around the globe because of its low fees. For every international wire deposit, you’ll pay a 0.05 percent fee, and this has a minimum amount of €7.50 Euros or $7.50 US dollars. Every international wire withdrawal will cost 0.09 percent fee, and it has a minimum withdrawal amount of €50 Euros or $50 US dollars. There is also trading fees that fluctuate depending on the amount of currency you move.
- Security Features – This exchange operates under consumer protection laws and digital asset regulations. All of the digital assets on this exchange are placed into a secure cold storage, and Amazon Web Services hosts the exchange’s online assets. Finally, all of the United States Dollar accounts are held in New York in a chartered bank, and the FDIC insures them.
- User Interface – The exchange’s user interface is designed to be easy to use, and it has all of the key components on your orders in prices clearly displayed. It also constantly updates your balances in charts, so you have everything at your fingertips in real time. Traders can monitor the exchange from a mobile app on both iOS and Android devices.
Trading Fee Schedule
As we touched on earlier, Bitstamp has very minimal fees, and this makes it very popular for traders to move both large and small amounts of cryptocurrency without having the fees eating into your profit margins. In addition to the withdrawal and deposit fees, there are also trading fees to consider.
|Less than $20||0.25 percent|
|Less than $100,000||0.24 percent|
|Less than $200,000||0.22 percent|
|Less than $400,000||0.20 percent|
|Less than $600,000||0.15 percent|
|Less than $1,000,000||0.14 percent|
|Less than $2,000,000||0.13 percent|
|Less than $4,000,000||0.12 percent|
|Less than $20,000,000||0.11 percent|
|$20,000,000 and up||0.10 percent|
Cryptocurrencies Bitstamp Supports
Bitstamp is an exchange whose primary focus is on the more established cryptocurrencies available. Currently you can trade for Bitcoin (BTC), Ethereum (ETH), Bitcoin Cash (BCH), Ripple (XRP), and Litecoin (LTC). You are able to trade using 12 established pairs, and they’re all based on the US dollar (USD), Bitcoin (BTC), and the Euro (EUR).
While it is known for trading around 700 million US dollars worth cryptocurrency each day, around $400 million of those trades have a US dollar pairing, and €100 million of those daily cryptocurrency trades come from pairings with the Euro.
What the Public Thinks of this Exchange
The public is overwhelmingly in favor of the low fees this exchange offers. For Europeans, this is a favorable platform because they are able to deposit Euros into their accounts with the Single Euro Payments Area (SEPA) without an additional charge. There is also no fee when you withdraw Bitcoin. Finally, customers also like the fact that this platform is licensed and carefully monitored.
As with many exchanges, using a credit card to deposit money into your account comes with very high fees due to the higher risk for fraud. This platform also has a slightly longer verification process, and this can be frustrating if it takes over a week to go through. The public also noticed that this exchange is more limited in the cryptocurrencies they deal in as well. Finally, the process of wiring money out of the exchange into a European-based bank can be extremely hard because many of these banks don’t allow transactions with cryptocurrency companies.
Signing Up and Logging into the Exchange
Signing up for this platform is a relatively straightforward process. Start by going to Bitstamp’s site and create your free account. When you get to the site, you’ll fill in:
- First Name
- Last Name
- Email Address
- Country of Residence
Once you have that information filled in, click that you agree to the exchange’s terms and conditions and click register. When you hit the register button, Bitstamp will send a confirmation to the email address you input in the last step. This email will contain a site generated password and your user ID.
Come back to the exchange’s site and input your system generated client ID and password. It’ll log you in and prompt you to change your password. When you change your password, you can then set up a two-step authentication process. When this is done, you’ll be able to access and use the tools and features Bitstamp offers its clients.
Verifying Your Bitstamp Account
You won’t be able to perform bank transfers until you verify your account, and this is where people can get frustrated because it can take a few days to complete. Both corporate and personal accounts require you to provide the following documentation in order to verify your account:
- Passport, Driver’s License, National ID, or Valid Citizenship Paperwork
- Proof of Residence: Utility Bill, Government Issued Documents, or a Bank Statement
When you provide this information and its accepted, you’ll move on to the second step of the verification process. You’ll input your phone number, and you’ll be sent an OTP code that you input into the account. When all of these steps are finished, you’ll gain complete access to the features of your Bitstamp account including deposits, withdrawals, trades, and purchases.
Depositing Funds in Your Bitstamp Account
Before you make any cryptocurrency purchases or exchanges, you have to add funds to your account. Currently, you can fund your account by using a SEPA transfer, performing an international wire transfer, performing a cryptocurrency exchange, or by using a credit card.
If you decide to use an international wire transfer, you’ll pay a 0.5 percent fee on each transfer, and there is a minimum amount of $7.50 US dollars or €7.50 Euros. The time between making the initial wire transfer and the funds being available in your account ranges from two to five business days.
If you’re in Europe and you want to use Euros to fund your account, you can use the Single Euro Payments Area (SEPA) to do so. You have to get a SEPA order from your bank to complete the transfer, and it can take between one and three business days for the funds to make it into your Bitstamp account.
You’re also able to use a Bitcoin Cash deposit to fund your Bitstamp account. To do this, you log in and select “deposit” and then select “Bitcoin Cash.” You’ll see a 3* Bitcoin Cash address, and you can request a new one every 24 hours. You can use this to deposit funds into your account, and it takes six network confirmations before the funds will land in your account.
The final option to fund your account is by using a credit card. This is convenient for people because you get immediate access to your funds in your Bitstamp account. However, this deposit method is very expensive, and it has very high fees attached to using it because it’s easy to dispute the payments as fraudulent purchases.
Deposit and Withdrawal Fees
|Credit Card||5 percent||—–|
|Debit Card||—–||$10 up to 2%|
Trading Using Bitstamp
Once your deposit shows up in your account, you’re ready to use the exchange and start trading for cryptocurrencies. Navigate to the exchange’s BUY/SELL button and find the trading pair you want to use. Next, place a limit or market order on the exchange. The final step is for you to enter the quantity and price and submitting the order for processing.
When you submit your order, your account will be credited with the cryptocurrency you purchased. You can now take this cryptocurrency and sell it on Bitstamp, or you can transfer the funds out to your external wallet. Once the funds go into your external wallet, you can use them however you want.
Supported Bitstamp Orders
This exchange has five different orders you can use when you’re trading on this exchange.
1. Instant Orders
Any traders who want to trade immediately are recommended to use the instant order feature. Basically, you can set this order up with the amount of cryptocurrency you want to purchase, and it’ll execute the purchase immediately, regardless of the current market price. If the amount of the desired cryptocurrency isn’t available at the instant price, the system with automatically reposition your order every second until you have the amount you want.
2. Limit Orders
If you want to purchase or sell your desired cryptocurrency at a specific price, limit orders are a good idea. So, if the exchange’s market is $11,000 US dollars for one Bitcoin and you want to buy when it reaches $10,000 US dollars for one bitcoin, you can set this limit. When the market reaches your specified limit, the order will instantaneously execute. If the market price is below your desired limit when you set the limit, it’ll fill it immediately.
3. Market Orders
Traders who want to sell or buy their desired cryptocurrency at the best market price available use market orders to do so. You simply have to input the amount of cryptocurrency that you want to purchase or sell. This type of order can even allow you to get your cryptocurrency at a better market price.
4. Stop Orders
If the exchange market is volatile and it has a lot of rapid drops and rises, a stop order is a safe buying and selling vehicle to use to negate any losses. You set your exact price exit and entry points, and it’ll monitor the market until it surpasses these parameters. When it passes them, the order is instantaneously executed.
If the exchange’s market has USD 11,000 per Bitcoin listed, you can set a stop sell order at $10,000 per Bitcoin. If the market drops to $10,000 per Bitcoin, your order will be executed to negate any potential losses. This also works for buying as well. If the market is USD 11,000 per Bitcoin, any trader who is out money should set up a stop buy order when the price reaches USD 12,000 per Bitcoin. This lets them make a profit.
5. Trailing Stop Orders
Trailing stop orders work like a stop order, but there is larger flexibility. If the exchange’s Bitcoin price is currently USD 11,000 per Bitcoin, but you think that it’ll go up before it falls, a trailing stop order can help. You can set it up for a $1,000 spread.
So, if the price goes up to USD 12,000 per Bitcoin, the order will reposition itself to $11,000 per Bitcoin. If the price drops, the order will instantly execute at $11,000 per Bitcoin. This secures the trader’s profits and increases the order’s value.
This exchange is one of the safest cryptocurrency exchange platforms you can use. However, it has seen its share of security concerns and breaches over the years. It handled them all remarkably well, and this is important to take into consideration when you’re thinking of safety.
During the second month of 2014, this exchange was threatened by hackers who claimed that they would perform a Distributed Denial of Service (DDOS) attack. Supposedly, the hackers went as far as to send Bitstamp’s CEO Nejc Kodrič a 75 Bitcoin ransom demand. However, the CEO refused saying that they didn’t negotiate with terrorists, and the service was restored. When the exchange restored service, it temporarily suspended the ability to make withdrawals as a security measure.
In early 2015, this exchange went under another attack by hackers, and this time they managed to take 19,000 Bitcoins successfully. While this is a big deal, it was nowhere near the 850,000 Bitcoin hack that the exchange Mt. Gox suffered.
In response to the successful 2015 hack, this exchange stepped up its security measures, and it has been incident free ever since. The successful hacking attempt prompted the security team to reevaluate the exchange’s security features and fortify them to make it a safer platform.
For starters, Bitstamp now gives its traders secure wallet options to store their cryptocurrency in. These wallets store information and access to your cryptocurrency, and it can’t be accessed unless your private key matches the public key. These keys are digital codes that act just like traditional banking or checking account’s PIN numbers. It keeps your cryptocurrency secure until you want to use it.
In addition to this, over 95 percent of all of the funds on this platform is held in a secure cold storage, and this makes these cryptocurrency funds inaccessible when it comes to hackers.
When you create an account, you have the option to set up two-factor or two-step authentication. This means that in order to access your account, there are mandatory SMS alerts along with mandatory confirmation email alerts.
The entire platform also utilizes layers of data encryption called Pretty Good Privacy (PGP). This encryption method helps to ensure that all of the uploaded data files on the exchange are secure, private, and authenticated.
How Bitstamp’s Customer Support Rates
As we mentioned earlier in the post, there are several options when it comes to customer support. It is recommended that you read through the FAQ page and get a good understanding of what you’re doing before you buy or trade your cryptocurrencies. You can email support for concerns or questions, and they usually reply within a few hours. If you have an emergency that can’t wait, you’re able to call your local Bitstamp office for immediate assistance.
Bitstamp is a cryptocurrency exchange that has several reputable partnerships along with notable achievements. It was the first Ripple Gateway, and it was also the Ripple’s first partner in its incentive program. This exchange has partnerships with Swissquote and Crédit Agricole SA (CACEIS), and these partnerships solidify this exchange’s financial community standing.
In Europe, Bitstamp became the first cryptocurrency exchange to become fully licensed. The Luxembourg Financial Industry Supervisory Commission (CSSF) regulates this exchange as well. Being regulated by the Luxembourg Financial Industry Supervisory Commission ensures that Bitstamp remains fully compliant with the relevant practices and that it files reports to the appropriate agencies.
Bitstamp’s Pros and Cons
- Low and Transparent Fees
- High Liquidity and Volume
- Compliant and Regulated Practices
- Reputable and Globally Recognized Exchange Platform
- No Margin Trading Available
- High Fees for Depositing Funds with Credit Cards
- Limited Supported Cryptocurrency Choices
- Slow Response Times During Peak Periods
Bitstamp is an excellent cryptocurrency exchange platform for both advanced and intermediate traders, and it is especially beneficial to European cryptocurrency traders. It’s ability to transfer using SEPA and it’s low fees favor European traders as well. It has a very professional platform that has only improved its processes since it was founded in 2011.
This platform allows new cryptocurrency traders to immerse themselves into the cryptocurrency market by buying the cryptocurrency of their choice using fiat currency. It’s also a solid choice for traders who want to have security as they purchase and sell cryptocurrency like Litecoin, Bitcoin, Ripple, and Ethereum on this platform.