The blockchain sector’s most moving headline that rocked the headlines in 2011 was Mt. Gox hacking that saw 740,000 Bitcoins getting siphoned away. If the person that hacked the system still had Bitcoins today, the value would be about US Dollar 5,078,620,000!
Even in the middle of these attacks, people who had blockchain on mind and genuinely targeted taking it to the next level did not shy away from opening new platforms. It is because of this determination that Bitstamp was established in 2011.
Bitstamp was created with the focus of redefining the trading space by offering better security and user experience. But Bitstamp also fell into the same trap as attackers hit it with a DDOS attack in 2014 and another hack that saw 19,000 Bitcoins getting siphoned away in 2015.
This review of Bitstamp is a deep exploration into Bitstamp to answer the hard questions such as “Is Bitstamp legit?”
What Is Bitstamp?
Bitstamp was created in 2011 by Nejc Kodric and Damijan Merlak who wanted to provide a reliable and highly secure trading platform for the European client base. The exchange wanted to change the dominance of Mt. Gox in the market by offering users another platform to trade with a difference.
Two years after its launch, Bitstamp opened an office in London and expanded with another in Luxembourg in 2016. The founders wanted to create a direct line that cryptocurrency enthusiasts could use to make deposits, trade, and make withdrawals using fiat currencies.
In August 2018, Bitstamp was ranked among the top exchanges across the globe with 10.4% of the global market share of traded cryptocurrencies. This places it well ahead of other exchanges, including CEX.io and Bit-x.
Bitstamp: A 4.0 Star Rated Exchange
The Bitstamp architecture has been greatly improved between launch and today. More people coming to trade at Bitstamp are interested in enjoying the great trading platform, its long list of cryptocurrencies, and highly responsive support.
But the 4.0-star ranking could be higher were it not for the Exchange’s invasive tactics. Many users have complained that Bitstamp collects information about them without consent.
In many cryptocurrency forums, it is emerging that though Bitstamp is a great platform, the current high number of orders might be overwhelming. The platform might require reinventing to cater for the fast-evolving client base.
How Does Bitstamp Work?
Bitstamp operates as a centralized cryptocurrency exchange that requires users to create accounts, deposit funds, and select currency pairs to start trading. The platform has two levels of verification that are very easy to open and use.
- First level account verification: In this level, the user is required to provide a name, email address, national ID/passport, and proof of residence.
- Second level account verification: This level requires the user to provide all the information in the first level verification plus a phone number.
With the account properly set, you are only one step away from trading the dream cryptocurrencies. You can fund the trading account with another token from a cryptocurrency wallet, credit card, or even wire transfer.
Note: Wire transfers take time. You might need to wait for a couple of days depending on your location and the involved bank policies.
To start trading, pick the cryptocurrency pair of choice and then hit buy/sell button depending on the movement of the selected cryptocurrencies. Make sure to put the market or limit order before selecting the right price and quantity to start processing the orders. Here is a demonstration video of how Bitstamp works.
The transaction charges at Bitstamp are based on the traded volume. The lowest fee for traders operating in the platform is 0.25% for those trading coins of less than $20,000.
For traders moving volumes of more than $20 million worth of digital tokens, the transaction fee is 0.1%. Note that this trading volume is calculated on a cumulative basis every month.
If you want to make deposits and withdrawals with credit cards and wire transfers, there is an additional fee. Wire transfer deposits are charged at 0.05% while withdrawals attract a fee of 0.09%.
For people who want to use credit cards to deposit and withdraw from Bitstamp, an additional 5% and $10 will be charged. While these charges can indeed push the cost of trading at the exchange very high, it is important to understand that they are mainly levied by the banks and credit card companies.
Is Bitstamp Safe?
After a series of hacking in its history, many users have been wondering about whether the platform is indeed safe. To try and prevent further attacks and minimize risks, here are some of the methods used at Bitstamp to keep it secure:
- Over 95% of the user’s tokens are stored in cold storage.
- The platform uses 2-factor authentication.
- The platform adopted advanced encryption to keep user information secure.
Bitstamp’s design, focus, and consistency have helped it to progressively grow and become among the top 10 global cryptocurrency exchanges.
The exchange allows users to make deposits and withdrawals using fiat currencies
- The exchange has a very intuitive user interface.
- It supports many cryptocurrency tokens.
- The exchange has many partnerships with top companies such as the Financial Supervisory Commission (CSSF) that help to demonstrate its reliability.
- Bitstamp’s long period of operation has won it a lot of trust in the community.
- The platform has a 0% deposit and withdrawal fee for those withdrawing in cryptocurrencies.
- The exchange has a history of several hackings.
- Clients have a lot of complaints especially regarding delayed payments and invasive policies.
For about the eight years that Bitstamp has been in operation, the target has been to grow progressively by enriching its core features such as Live Trades, Live Order Book, and customer support. The simplified registration system and enhanced security have also made more people flock to the platform.
Despite its impressive work and interface, Bitstamp’s reviews on Reddit and other platforms appear to suggest that something is not right. From delayed to canceled orders and orders taking too long to process, it appears that the platform might be overwhelmed.
Is Bitstamp legit? While the answer to the question is “yes” based on the info provided on their platform, this Bitstamp review indicates that you should approach it with extra caution.
Many reviews of Bitstamp concur with users in top forums such as Reddit that people should compare Bitstamp with other exchanges such as Binance and Cryptopia before moving their funds. If you need to invest at Bitstamp, it is advisable to do so gradually.